South Korea Inflation Rate Down to 1.2% in April


In South Korea, the year-on-year inflation rate slowed to 1.2 percent from 1.3 percent recorded in March due to falling oil and vegetable prices. Inflation stayed comfortably below the Central Bank of Korea's target range of 2.5-3.5 percent, leaving room for further monetary easing to spur growth.

On the year-on-year basis, the inflation rate slowed to 1.2 percent in April of 2013 from 1.3 percent recorded in March 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, 2.6 and 1.7 percent respectively, from 3.8, 3.2 and 1.9 recorded in March). The index for Food and non-alcoholic beverages increased 1.2 percent in April from 0.8 percent recorded last month. Prices of Restaurant and hotels, Education, and Health grew 1.6 percent, 1.2 percent and 1 percent respectively from 1.4 percent, 1.6 percent and 0.1 percent recorded in the previous month. Recreation and culture costs increased 0.5 percent, from 0.9 in March, and prices for Furnishings, household equipment and routine maintenance increased by 0.1 percent from a 0.1 percent drop in March. Prices of Miscellaneous goods and services decreased 1.8 percent in April of 2013 and Transport prices fell 1.5 percent from the same period last year. Communication prices dropped 0.1 percent. 

On the month-on-month basis, the inflation rate decreased 0.1 percent in April of 2013, following a 0.2 percent decline in the preceding month. The index for Food and non-alcoholic beverages, Housing, water, electricity, gas and other fuels and Education increased 0.1 percent respectively in April. The index for Alcoholic beverages and tobacco and Communication decreased 0.1 percent respectively in April. The index for Furnishings, household equipment & routine maintenance and Miscellaneous goods and services went down 0.4 percent respectively in April. The index for Clothing and footwear, Health and Transport decreased 1.0 percent, 0.2 percent and 0.9 respectively in April.
 
Core inflation, which excludes volatile oil and food prices, rose 1.4 percent on-year in April, down from a 1.5 percent rise in the previous month.

Joana Taborda | joana.taborda@tradingeconomics.com
5/2/2013 10:05:44 AM