SEOUL, South Korea’s consumer prices stayed below 3 percent for the second consecutive month in May, but prices of fruits and petroleum products soared over supply issues and unstable global oil prices, data showed Tuesday.
Consumer prices, a key gauge of inflation, rose 2.7 percent on-year last month, compared with the 2.9 percent on-year rise a month earlier, according to the data from Statistics Korea.
It marked the second straight month that the price growth slowed down and the figure stayed below 3 percent.
In January, inflation fell below 3 percent for the first time since July 2023 to come to 2.8 percent, but it rose back to 3.1 percent in February and stayed at the same level the following month.
May’s inflation was led by soaring prices of farm produce, particularly fruits.
Prices of agricultural, livestock and fisheries products advanced 8.7 percent on-year.
Agricultural products, in particular, spiked 19 percent, which accounted for a 0.69 percentage point increase in the overall inflation.
O
f major items, prices of apples spiked 80.4 percent and prices of pears surged a record level of 126.3 percent.
The country is experiencing a supply shortage of fruits due to poor harvests last year amid unfavorable weather conditions, and such high prices are expected to continue for some time, an agency official said.
Prices of petroleum products rose 3.1 percent on-year in May, the highest increase in 16 months, amid instability in global oil prices due to the Middle East crisis.
Dubai crude, South Korea’s benchmark, came to US$84.04 per barrel on average last month, falling from April’s $89.17. The price had risen in recent months from $78.85 in January to $80.88 in February and $84.18 in March, according to government data.
Service prices increased 2.3 percent on-year in May.
Core inflation, which excludes volatile food and energy prices, gained 2.2 percent.
Prices of daily necessities — 144 items closely related to people’s everyday lives, such as food, clothing and housing — climbed 3.1 percent
last month, the data showed.
“We’ve seen a gradual easing of inflationary pressure, though uncertainties remain over geopolitical uncertainties and weather conditions,” an agency official said.
The government has said that the country is projected to reach the target rate of 2 percent by around the end of 2024, though prices are forecast to ease at a slower pace than earlier expected.
The finance ministry expects this year’s prices to rise 2.6 percent.
In an effort to tame inflation, the government decided to extend tariff reduction on imports of 28 kinds of fruits, including bananas, mangoes and kiwis, through the end of 2024.
It will also either extend or introduce the lower-tariff scheme for 19 types of food materials, such as sugar and butter.
“Despite the gradual easing of inflation, the overall level of prices has heightened to cause a burden on the people. The government will strive for stabilizing prices further,” Choi said, calling on companies to join the efforts.
“Public institutions need to
refrain from raising utility rates or at least minimize the level of increases, which is the government’s obligation for the people,” he added.
Source: Yonhap News Agency
