Korea: Inflation picks up in June
July 1, 2011
In June, consumer prices added 0.17% over the previous month, which was above the flat reading recorded in May and contrasted the 0.17% drop observed in June 2010. As a consequence, annual inflation jumped from 4.1% in May to 4.4% in June, slightly exceeding market analysts' expectations of inflation rising to 4.3%. With June's result, annual inflation remained above the Central Bank's target of 3.0% 1.0 percentage points for the sixth consecutive month. The core inflation index, which excludes more volatile items such as fresh food and energy, added 0.34% over the previous month, which was below from the 0.51% increase recorded in May but above the 0.18% rise recorded in June 2010. Consequently, annual core inflation jumped from 3.5% in May to 3.7% June, the highest level since May 2009. The Central Bank expects inflation to end the year at 3.9% in 2011, before stepping down to 3.4% by the end of 2012.
Author: Armando Ciccarelli, Head of Data Solutions