November Consumer Prices Up 3.7%... Highest in 9 Years and 11 Months (Update)

Consumer Price Trends

[Sejong=Asia Economy Reporter Son Seonhee] Last month, the consumer price inflation rate rose by 3.7% compared to the same month a year ago. This is the highest level in 9 years and 11 months since December 2011 (4.2%).

According to the 'November Consumer Price Trends' released by Statistics Korea on the 2nd, the consumer price index last month was 109.41 (based on 2015=100), showing a 3.7% increase compared to the same month last year. Following the 3.2% inflation rate in October, this marks two consecutive months of over 3% inflation, with the rate of increase also expanding.

Oh Woonseon, the Economic Trend Statistics Officer at Statistics Korea, explained, "While the base effect from telecommunications fee support has diminished, causing the rise in public service prices to slow down, the prices of agricultural, livestock, fishery products, and industrial products have increased significantly, expanding the overall inflation rate by 0.5 percentage points compared to the previous month."

Looking at individual items, petroleum prices surged by a whopping 35.5% compared to a year ago, driving up the overall industrial product prices. This is the largest increase in 13 years and 4 months since July 2008 (35.5%). Although the fuel tax reduction policy was implemented from mid-last month, there was a time lag before it was reflected in actual prices, making it insufficient to stabilize petroleum prices in November.

Due to the rise in petroleum prices, industrial product prices also increased by 5.5% during the same period. This is the largest increase since November 2011 (6.4%).

With the early cold wave and poor crop yields, prices of agricultural, livestock, and fishery products rose by 7.6% compared to a year ago. Vegetable prices increased by 9.3%, and livestock products saw a 15% rise in prices.

Service prices also rose by 2.2% compared to the same period last year. Personal service prices increased by 3.0% due to rising prices in dining out and other services. Rent also rose by 1.9%, marking the largest increase since June 2016 (1.9%).

The core inflation rate (excluding agricultural products and petroleum) rose by 2.3%, reflecting the underlying trend of inflation.

The living cost index, which covers 141 items that consumers frequently purchase and spend on, such as food and daily necessities, and is sensitive to price changes, rose by 5.2%. This is the highest increase in 10 years and 3 months since August 2011 (5.2%).