SEJONG, Aug. 4 (Yonhap) — South Korea’s annual inflation rose 0.3 percent in July, marking the first upturn in three months, as signs of a recovery in consumer sentiment have appeared amid the coronavirus pandemic, data showed Tuesday.
The July tally compares with zero growth in June, according to the data released by Statistics Korea.
The nation’s inflation was unchanged on-month, the data showed.
Core inflation, which excludes agricultural and petroleum products, rose 0.7 percent from a year earlier.
Utility prices were unchanged last month, while prices of agricultural, livestock and fisheries products climbed 8.4 percent on-year in July, the data showed.
In July, prices of petroleum products dropped 10.2 percent on-year, the data showed. Prices of livestock products jumped 9.5 percent from a year earlier, and prices of processed foodstuffs rose 1.6 percent.
South Korea’s consumer prices had increased at less than 1 percent for 12 consecutive months before growing 1.5 percent in January, followed by a 1.1 percent increase the following month.
Slowing inflation may give the Bank of Korea (BOK) more room to ease its monetary policy.
In May, the BOK slashed its policy rate by a quarter percentage point to a record low of 0.5 percent as the nation’s economy is expected to grow at the slowest pace in over two decades amid the pandemic.
The country saw exports fall 7 percent in July, extending their slump to a fifth consecutive month. However, it marked the slowest decline in four months, suggesting that an economic recovery is gaining momentum.
Vice Finance Minister Kim Yong-beom said signs of an economic recovery became clearer in the month, citing the “triple growth” of increases in production, consumption and investment in June.
The government will spare no efforts to boost local consumption to achieve an economic rebound in the third quarter, Kim told a meeting with senior ministry officials.