Korea: Inflation drops in February to lowest level since August 2016
March 5, 2019
Consumer prices increased 0.4% in February compared to the previous month, contrasting the 0.1% decrease in January. In February, higher prices came on the back of more expensive housing, water, electricity, gas and other fuels, and food and non-alcoholic beverages. Cheaper transport, however, limited overall price gains.
Inflation moderated to 0.5% in February from 0.8% in January, falling further below the Bank of Korea’s 2.0% target and hitting the lowest level since August 2016. Core inflation, which excludes fresh food and energy prices, picked up to 1.1% in February from 1.0% in January. Annual average inflation, meanwhile, ticked down to 1.4% in February from 1.5% in January.
Korea Inflation Forecast
FocusEconomics Consensus Forecast panelists expect inflation to average 1.5% in 2019, which is down 0.2 percentage points from last month’s forecast. In 2020, the panel expects inflation to also average 1.7%.
Author: Edward Gardner, Economist