Post by : Meena Ariff

Consumer prices in South Korea increased by 2.1 percent in 2025 compared to the previous year, according to government data released Wednesday. This figure is just above the Bank of Korea’s official inflation target of 2 percent, indicating a slight rise in the cost of living across the country.

This annual inflation rate of 2.1 percent is the lowest since 2020, when consumer prices increased by only 0.5 percent. Over the past few years, inflation in South Korea has seen significant fluctuations. It surged from 2.5 percent in 2021 to a high of 5.1 percent in 2022, before gradually easing down to 3.6 percent in 2023 and 2.3 percent in 2024.

In December 2025 alone, consumer prices rose by 2.3 percent year-on-year. This marked the fourth month in a row that inflation exceeded the central bank’s 2 percent target. The government attributed this continued inflation mainly to the rising cost of imports, which was influenced by a weakening Korean won against other currencies.

Throughout the year, inflation stayed mostly within the 2 percent range. It held steady at around 2 percent during June and July, dipped to 1.7 percent in August, then climbed back up to 2.1 percent in September. Inflation remained close to that level for the rest of the year.

A key driver of the recent inflation increase was the sharp rise in petroleum product prices. In December, prices for petroleum products jumped 6.1 percent compared to the same month the previous year. This was the largest year-on-year increase since February, when prices rose by 6.3 percent.

In addition to headline inflation, core inflation—which excludes food and energy prices that tend to be more volatile—also rose by 2.3 percent in December. This suggests that the overall rise in prices is not just limited to fuel and food but is spreading across other sectors as well.

The data highlights ongoing inflationary pressures in South Korea’s economy, despite some recent easing compared to the peak levels seen in 2022. Policymakers at the Bank of Korea will likely continue to monitor the situation closely as they balance efforts to keep inflation in check while supporting economic growth.

#Global News #World News