Korea Inflation


Korea: Inflation steady in July, remains well below target

August 4, 2015

In July, consumer prices increased 0.2% over the previous month, which was up from the flat reading tallied in June. July’s print reflected that higher prices for transport more than offset a decline in prices for housing, utilities, and fuel.

Annual headline inflation in July remained at June’s 0.7%, which was in line with market expectations. June’s print marked the third straight pick-up in inflation after a long string of declines. However, with July’s unchanged result, inflation remains well below the Central Bank’s target range of 2.5%–3.5%. Annual average inflation inched down from 0.9% in June to 0.8% in July.

Core consumer prices, which exclude fresh food and energy prices, increased 0.2% in July over the previous month, which was up from the flat reading registered in June. Regarding annual figures, core inflation was unchanged at 2.0% in July.

The Central Bank expects annual average inflation of 0.9% in 2015 and 2.2% in 2016. FocusEconomics Consensus Forecast panelists expect inflation to average 1.1% in 2015, which is down 0.2 percentage points from last month’s forecast. In 2016, the panel expects average inflation to reach 2.0%.

Author:, Economist

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Korea Inflation Chart

Korea Inflation July 2015

Note: Month-on-month and year-on-year changes of consumer price index in %.
Source: National Statistics Office of Korea (KOSTAT)

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