South Korea Inflation Rate Slows in March to 1.3%


In South Korea, the year-on-year inflation rate slowed to 1.3 percent in March of 2013, well below the central bank’s expectations, mainly due to a slight increase in food prices and a decline in prices of transport, furnishings and miscellaneous goods and services.

On the year-on-year basis, the inflation rate slightly decreased to 1.3 percent in March of 2013 from 1.4 percent recorded in February of 2013. Prices of Housing, water, electricity, gas and other fuels, Clothing and footwear and Alcoholic beverages and tobacco recorded the highest increases (3.8, 3.2 and 1.9 percent respectively, from 3.5, 3.3 and 1.6 respectively, recorded in February). The index for Food and non-alcoholic beverages increased 0.8 percent in March from 2.7 percent recorded last month. Prices of Education, Restaurant and hotels and Recreation and culture grew 1.6 percent, 1.4 percent and 0.9 percent respectively from 1.8 percent, 1.0 percent and 0.5 percent recorded in the previous month. Health costs increased 0.1 percent, the same rate recorded in February. Prices of Miscellaneous goods and services decreased 1.1 percent in March of 2013 and Transport prices fell 0.2 percent from the same period last year. The index for Furnishings, household equipment and routine maintenance declined 0.1 percent in March of 2013 from the same month last year while Communication prices remained unchanged in March. 

On the month-on-month basis, the inflation rate slightly decreased 0.2 percent in March of 2013 from a 0.3 percent increase in the preceding month. The index for Alcoholic beverages and tobacco, Housing, water, electricity, gas and other fuels and Health increased 0.2 percent, 0.6 percent and 0.1 percent respectively in March of 2013. The index for Transport and Recreation and culture went up 0.7 percent and 0.1 percent respectively in March. The index for Food and non-alcoholic beverages, Clothing and footwear and Furnishings, household equipment and routine maintenance decreased 0.9 percent, 0.1 percent and 0.1 percent respectively in March. Prices of Education, Restaurants and hotels and Miscellaneous goods and services went down 1.0 percent, 0.2 percent and 2.9 percent respectively in March. Communication prices remained unchanged in March. 
 
Core inflation rate which excludes agricultural products and oils rose 1.5 percent from March of 2012, but declined 0.2 percent from the preceding month.
 

Joana Taborda | joana.taborda@tradingeconomics.com
4/3/2013 11:21:24 AM