Consumer prices grow fastest in 19 months in May

By Korea Herald
  • Published : Jun 3, 2014 - 21:07
  • Updated : Jun 3, 2014 - 21:07
South Korea’s consumer prices grew at the fastest pace in 19 months in May, maintaining their upward trend after a protracted slow price gain that prompted concerns over deflation, a government report showed Tuesday.

The country’s consumer price index rose 1.7 percent last month from a year earlier, the fastest on-year rise since October 2012, when it advanced 2.1 percent, according to the report by Statistics Korea.

The core inflation, which excludes volatile oil and food prices, rose 2.2 percent on-year, down from April, when it went up 2.3 percent, the report showed.

“The rise is attributable to the base effect of last year when prices of farming and oil-related products sharply dropped,” said Kim Bo-kyung, the head of the agency’s prices statistics division.

“We can say that the downward trend of oil prices is easing this year, which led to the relatively high consumer prices compared with last year,” she added.

The data come amid worries that the country might be entering a deflation phase as consumer price growth remained at around 1 percent until February. It fell to as low as 0.9 percent in October.

The report showed that utility services such as electricity, tap water and gas jumped 4.2 percent on-year in May, while the prices of products manufactured in factories, including oil-related goods, rose 2.2 percent. (Yonhap)