Vice Minister Gi Jae: "July Inflation Also in 6% Range... Trade Balance Deficit Expected"

Bang Gi-seon, the 1st Vice Minister of the Ministry of Economy and Finance, is speaking at the "4th Emergency Economic Vice Ministers' Meeting" held on the 29th at the Export-Import Bank of Korea in Yeongdeungpo-gu, Seoul. (Photo by Ministry of Economy and Finance)

[Asia Economy Sejong=Reporter Son Seon-hee] Bang Gi-seon, the 1st Vice Minister of the Ministry of Economy and Finance, said on the 29th regarding the 'July Consumer Price Index' to be announced next week, "Due to the price increase of agricultural products caused by the monsoon and heatwave, the inflation rate is expected to remain in the 6% range following last month."

Vice Minister Bang made these remarks while presiding over the '4th Emergency Economic Vice Ministers' Meeting' at the Export-Import Bank of Korea in Yeongdeungpo-gu, Seoul, on the morning of the same day. Last month's Consumer Price Index rose 6.0% year-on-year, marking the highest level in about 23 years, and it is forecasted that the high inflation rate in the 6% range will continue in July as well.

However, Vice Minister Bang noted, "Some positive signs are gradually appearing," adding, "Due to the reduction in fuel tax, the average retail price of gasoline at domestic gas stations fell to 1,915 won as of the previous day." He further predicted, "If the current price decline continues, it is expected that the price will enter the 1,800 won range next week for the first time since March 9."

Additionally, he emphasized, "Although international raw material and grain prices have recently been declining, there is a time lag before the international price drop is reflected domestically, and price instability factors remain due to demand for Chuseok seasonal products. Therefore, we will further strengthen policy efforts to stabilize prices." In this regard, the government plans to prepare and announce a Chuseok livelihood stabilization plan next month.

Meanwhile, regarding this month's export-import trends, Vice Minister Bang said, "Exports continue to increase," but added, "Energy imports are rapidly rising due to summer cooling demand, so the trade balance is expected to record a deficit."

He stated, "The government will strengthen policy responses to sustain export growth and improve the trade balance," and said, "Along with expanding trade finance supply to export companies, the Ministry of Trade, Industry and Energy will closely gather industry opinions to prepare comprehensive export support measures, including resolving field difficulties, improving regulations, and strengthening the competitiveness of key industries."