S. Korea’s consumer prices up 3.6% in 2023 with signs of easing

[Photo by Yonhap]

The pace of consumer price increases in South Korea this year has slowed slightly from last year, but remains in the mid-3 percent range, continuing a trend of inflation that is making consumers hesitant to open their wallets.

According to data released by Statistics Korea on Friday, the country’s consumer price index stood at 111.59 in 2023, up 3.6 percent from last year, when 2020 was measured against a base of 100. This is a slower increase than last year’s 5.1 percent, but still higher than the 2.5 percent rise in 2021. Before the Covid-19 pandemic, from 2016 to 2018, the index was in the 1 percent range for consecutive years and 0.4 percent in 2019.

Prices of electricity, gas, and water supply jumped by 20 percent after energy price hikes. The increase was the largest in 13 years since data compilation in 2010.

Prices of agricultural products remained higher during the second half of the year than in ordinary times because of rare weather events in the summer and winter.

Fresh fruit prices showed significant increases, with prices of apples jumping 24.2 percent, tangerines 19.1 percent, and strawberries 11.1 percent.

A drop of 11.1 percent in petroleum prices this year, following a surge to more than 20 percent in 2022, contributed to a decline in inflation.

Core inflation, which excludes agricultural and petroleum products and shows the underlying price trends, rose 4 percent.

The living necessities price index, a group of indicators for items with high purchase frequency and high expenditure share, rose 3.9 percent.

Prices in December were up 3.2 percent from the same month last year.

Agricultural, livestock, and seafood prices rose 7.7 percent, led by a 15.7 percent jump in farm products. This month’s increase in agricultural prices was the highest since April 2021.

The monthly inflation rate has seen a steady decline this year, starting at 5.0 percent in January and gradually falling into the 2 percent range by June (2.7 percent) and July (2.4 percent).