Inflation hits highest level in a year in September

Vegetables are offered for sale at an Emart in Seoul on Friday. Vegetable prices rose in the double-digits in September compared to a year ago. [YONHAP]

Korea’s growth in consumer prices hit the highest level in a year in September.

Statistics Korea said Friday that the country’s consumer price index climbed 1.9 percent last month from a year earlier, accelerating from the previous month’s 1.4 percent on-year gain.

The on-year rise was the highest since September 2017, when the comparable figure was 2.1 percent.

From a month earlier, the index rose 0.7 percent. Core inflation, which excludes volatile oil and food prices, rose 1.2 percent on-year.

The September figure was below the Bank of Korea’s target of 2 percent for the year.

Still, the upturn in inflation could support an interest-rate hike as the central bank was waiting for stubbornly low consumer prices to go up to raise its benchmark interest rate.

Prices of agricultural goods shot up 7.1 percent on-year last month, compared with a 3.5 percent on-year gain in August. In the case of vegetables, prices surged 12.4 percent on-year last month.

Prices of industrial goods increased 1.9 percent from the year before, compared to a 2 percent on-year rise reported the previous month, the agency said. Oil prices also surged 10.7 percent last month.

The statistics office said prices for services moved up 1.4 percent last month, the same rate as in August. Following a surge in prices of vegetables, the government said it would make efforts to stabilize the country’s consumer prices by increasing supply.

“September’s consumer price growth accelerated due to a rise in prices of agricultural products and the tapering off of a one-time cut in electricity bills,” Vice Finance Minister Ko Hyeong-kwon said in a policy review meeting.

“The government will control consumer prices via a rise in supply,” he said.

As to rising oil prices, the government said it will monitor global oil prices and redouble efforts to stabilize them.

BY PARK EUN-JEE, YONHAP [park.eunjee@joongang.co.kr]