Korea's producer prices rise for fifth month in April

A customer shops for fresh fruits in a supermarket in Seoul on April 2. [NEWS1]

Korea's producer prices rose for the fifth consecutive month in April, partially driven by the soaring prices of services and industrial goods, central bank data showed Wednesday.

The producer price index, a major barometer of consumer inflation, increased 0.3 percent in April from a month earlier, following a 0.2 percent on-month gain the previous month, according to the preliminary data from the Bank of Korea (BOK).

On a yearly basis, the index rose 1.8 percent after a 1.5 percent on-year gain the previous month.

The rise is blamed on a 0.7 percent on-month advance in the prices of industrial goods and a 0.2 percent rise in services.

Meanwhile, agricultural products saw a 4.9 percent decline in prices from the previous month, and seafood prices decreased 4.2 percent.

Producer prices are one of the key indicators that determine the trajectory of inflation, as they influence the prices that businesses charge to consumers in the months ahead.

Korea's inflation rose 2.9 percent in April, marking the first time in three months that the index fell below 3 percent.

The country's central bank froze its key rate for the 10th straight session at 3.5 percent last month amid slower-than-expected inflation moderation. The rate freezes came after the BOK delivered seven consecutive rate hikes from April 2022 to January 2023.

The BOK is expected to once again keep the base rate flat in its rate-setting meeting slated for Thursday.

BY SHIN HA-NEE, YONHAP [shin.hanee@joongang.co.kr]