Consumer price inflation 4.8% in April… Highest growth rate since the 2008 financial crisis
In April, the consumer price inflation rate soared to the high 4% range, the highest level in 13 years. International energy prices have risen sharply since the Ukraine crisis, combined with higher electricity rates, disruptions in global supply chains, and recovery in demand.
According to the consumer price trend in April announced by the National Statistical Office on the 3rd, the consumer price index for last month was 106.85 (2020 = 100), up 4.8% from April last year. This is the highest growth rate since the financial crisis in October 2008 (4.8%).
After entering the 3% range in October last year, the consumer price inflation rate has been maintained at the 3% level for five months. Then, it passed the 4% level in March of this year (4.1%) and soared to the high 4% level last month.
Last month, industrial products such as petroleum and personal services acted as a factor in inflation. Looking at commodity prices, industrial products including petroleum products (34.4%) and processed foods (7.2%) rose by 7.8%. The contribution of industrial products to the inflation rate reached 2.7 percentage points.
Livestock products also showed a 1.9% increase, led by 7.1% of livestock products, which had slowed down in the past month. In line with KEPCO’s electricity rate hike, electricity, gas and water prices rose by 6.8%. Electricity price inflation was 11%.
Service prices rose 3.2% for personal services, up by 4.5%, for public services by 0.7%, and rent by 2%, respectively. Among personal services, eating out rose 6.6 percent, the same as last month, the highest since April 1998 (7.0 percent).
The core price index (excluding agricultural products and petroleum products), which shows the basic trend of prices, rose 3.6%. This is the highest increase since December 2011 (3.6%). The cost of living, a measure of the perceived cost of living, also rose by 5.7 percent. This is the highest level since August 2008 (6.6%).
Eo Woon-seon, director of economic trend statistics at Statistics Korea, said, “While prices for industrial products such as petroleum products and processed foods and personal services continued to rise significantly, prices for electricity, gas, and water also increased. However, it is mainly due to the increase in oil, electricity, and gas rates,” he said.
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