"Worrying about ingredient costs and rising interest rates... The struggles of ordinary people deepen"

High Inflation and Base Interest Rate Hike... Common People 'Cry Out'
Processed Food and Vegetables Continue to Rise
Dining Out Prices Reach Highest in 30 Years and 2 Months

"My income has stayed the same, but my expenses seem to have doubled."

Jeon In-young (42, pseudonym), a housewife living in Anyang, Gyeonggi Province, is currently experiencing serious "price stress." She sighs every time she goes grocery shopping because food prices have risen so much. From ingredients to processed foods, prices have increased so much compared to before that she finds it hard to decide what to pick up at the supermarket. With education expenses for her two children and rising fuel costs, her husband's essential expenses have also increased. Jeon said, "Even just covering living expenses is tight, and with interest rates continuing to rise, the burden is too great," adding, "Saving money is out of the question, and it's even hard to maintain our current lifestyle."

As the high inflation situation continues, the worries of ordinary people are deepening, and with the base interest rate also rising, the financial burden on households is expected to increase further. From office workers to self-employed individuals, cries of "I can't make ends meet" are erupting everywhere.

The Bank of Korea's Monetary Policy Committee (MPC) held a meeting on the 12th at 9 a.m. and decided to raise the base interest rate by 0.50 percentage points (p) from the current 2.50% to 3.00%. This means that the burden on household interest payments will increase following the rise in food prices. The consumer price inflation rate remains in the 5% range. Last month, the Consumer Price Index was 108.93, up 5.6% compared to the same month last year. Although it decreased for two consecutive months following 5.7% in August, it is still not a significant drop.

In this situation, the upward trend in prices of food-related items, including processed foods, agricultural products, and dining out, continues. In the second half of the year, the food industry’s price hikes are ongoing, and vegetable prices are also showing a continuous upward trend.

According to the Korea Consumer Agency's Chamgagyeok (True Price) data, among 32 high-consumption processed food items last month, prices of 22 items rose compared to the previous month. By category, gochujang (red chili paste) increased the most at 11.7% compared to the previous month, followed by cola (9.6%), canned tuna (5.9%), mayonnaise (5.1%), ramen (4.8%), soup (4.6%), fish cake and instant rice (3.1%), and so on. These price increases were due to manufacturers raising their wholesale prices, the end of discount promotions, and price adjustments. On the other hand, prices of cooking oil (-9.0%), sausages (-6.1%), instant porridge (-2.6%), cup rice (-1.8%), and flour (-1.7%) decreased.

Vegetable prices show a similar trend. According to the Korea Agro-Fisheries & Food Trade Corporation's agricultural product distribution information statistics, as of the previous day, the wholesale price of 10kg of napa cabbage was 15,860 won, which is more than half lower than 36,185 won a month ago, but still below the average level (12,269 won). Cabbage also rose 159% compared to the same period last year, costing 12,920 won for 8kg versus 4,970 won. The price of radish increased 180% compared to last year, at 27,800 won for 20kg versus 9,918 won.

Dining out prices rose 9% last month, marking the highest increase in 30 years and 2 months since 1992. Among dining out items, hamburgers rose 13.5%, galbitang (beef rib soup) 12.9%, gimbap (Korean sushi roll) 12.9%, jajangmyeon (black bean noodles) 12.2%, and haejangguk (hangover soup) 12.1%.