South Korea consumer inflation hits 21-month low

SEOUL  -South Korea’s consumer inflation slowed more than expected and hit a 21-month low, official data showed on Tuesday, weighed by falling oil and agricultural product prices.

The consumer price index rose 2.7 percent in June from a year earlier, compared with an increase of 3.3 percent in May and a median forecast of 2.85 percent in a Reuters survey of economists.

It softened for a fifth consecutive month and marked the weakest annual increase since September 2021, according to Statistics Korea.

Core inflation, which excludes volatile food and energy prices, slowed to 3.5 percent from 3.9 percent a month before, marking the slowest annual rise since May, 2022.

The headline index was flat on a monthly basis, compared with a 0.3 percent rise in the previous month and a 0.2- percent increase expected by economists.

Prices of petroleum products dropped 4 percent over a month and agricultural products fell 0.9 percent, but public utility prices rose 2.2 percent.

Services prices rose 3.3 percent from a year earlier, weaker than 3.7 percent in May and the slowest in 14 months.

South Korea’s central bank has kept monetary policy unchanged since its last interest rate hike in January and its tightening campaign is widely expected to be over. The bank next meets on July 13.

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