The Bank of Korea said on the 2nd that consumer price inflation slowed to the 2% range in September but that underlying price pressures actually intensified.
Lee Ji-ho, deputy governor of the BOK, chaired a price review meeting at the central bank that morning and said that although headline, core and living-cost inflation all eased from the previous month, price pressures had somewhat intensified when accounting for the disappearance of a temporary base effect from August.
The BOK said the comparison must factor in a 50% telecommunications fee discount by SK Telecom a year earlier, which pushed August's headline inflation 0.6 percentage points higher, core inflation 0.8 percentage points higher and living-cost inflation 1.1 percentage points higher this year.
Among core items, personal service prices continued to rise sharply, led by airfares and travel costs, as cost pressures passed through, Lee said. Prices of durable goods such as electronics also saw bigger gains on the back of rising semiconductor prices, he added.
October consumer price inflation is expected to stay at a high level of around 3% as price gains in core items persist, he said.
The Ministry of Data and Statistics said the same day that consumer prices rose 2.9% in September from a year earlier. Inflation had climbed to 3.1% in May and 3.2% in June amid the Middle East conflict before easing slightly to 2.8% in July and rebounding to 3.1% in August, then falling back into the 2% range last month.
