South Korea Consumer Prices Flat in October
Consumer prices in South Korea remained unchanged year-on-year in October 2019, following a 0.4 percent decline in the previous month and compared with market expectations of a 0.3 percent drop. Prices avoided a second month of deflation after booking in September the first fall since data releases began in 1965, as higher utility prices offset decreased prices of agricultural products.
11/1/2019 11:19:29 AM
Electricity and water and gas inflation was unchanged at 1.5 percent, while prices of agricultural, livestock and fisheries products fell 3.8 percent, compared to 8.2 percent plunge in September.
By expenditure category, prices of food and non-alcoholic beverages declined by 1.3 percent in October, a much softer pace compared to the 4.1 percent decrease for the prior month. It was the third straight fall in the sub-index, still recovering from the steepest drop since February 1987, as prices fell at a softer rate for fresh food (-7.8 percent vs -15.3 percent in September), namely vegetables (-1.6 percent vs -21.4 percent). In contrast, transportation prices fell further (-2.4 percent vs -1.6 percent). Cost of furnishings & household equipment increased by 2.2 percent (vs 1.4 percent in September), while inflation for housing edged down to 1.0 percent (vs 1.1 percent). Prices for education dropped once again by 0.8 percent and those for communication by 1.8 percent, while inflation for restaurants & hotels remained unchanged at 1.4 percent.
For 2019, the Bank of Korea targets inflation rate at 2 percent.
The core CPI, which excludes oil and agricultural products, advanced 0.8 percent over a year, following a 0.6 percent increase in September.
On a monthly basis, consumer prices increased 0.2 percent in October after increasing 0.4 percent.