SEOUL, Sept 2 (Reuters) – South Korea’s consumer inflation quickened in August due to low-base effects from the previous comparable period a year ago, data showed on Wednesday, but was lower than expectations.
The consumer price index (CPI) rose 3.1% in August from a year earlier, after climbing 2.8% in July, according to the Ministry of Data and Statistics. That compared with a median forecast for a 3.2% increase in a Reuters poll of economists.
Prices of public services rose 6.5%, driven by a one-off factor of 26.7% jump in mobile service fees due to temporary price discounts in August last year. Petroleum prices were up 14.2%, after rising 15.5% in July.
Without the one-off effect of mobile service fees, inflation would have been weaker at 2.5%, the finance ministry said after the data release, adding that nationwide fuel price caps lowered inflation by 0.3 percentage points last month.
The ministry also said it was expecting inflation to ease this month, while the central bank warned that the upward trend in underlying price pressure in core products would persist.
Last week, the Bank of Korea delivered a second straight increase in interest rates as inflation has been holding above target and financial stability risks persist.
CPI rose 0.2% on a monthly basis, after falling 0.2% in the previous month. Economists had expected a 0.3% rise.
Core CPI, stripping out volatile food and energy prices, was up 3.4% in August from a year earlier, after rising 2.6% in July. It was the fastest year-on-year increase since May 2023.
(Reporting by Jihoon Lee; Editing by Tom Hogue and Sam Holmes)
