August 2, 2023
In July 2023, South Korea’s consumer price index rose by 2.3% year-on-year, marking the sixth consecutive month of easing and reaching the lowest level in over two years. This supports the central bank’s decision to halt its tightening cycle for most of the year. The figure was slightly below market expectations of 2.4%, but still above the central bank’s target of 2%. The decline in inflation was mainly attributed to lower energy prices, while higher comparison bases from the previous year contributed to the perception of softer inflation this year.
The Bank of Korea had previously raised interest rates by 3 percentage points between August 2021 and January 2023, reaching a 14-year high of 3.5%. However, the central bank decided to pause its rate-increase campaign in February 2023, maintaining interest rates steady in the latest meeting.
Source: TradingEconomics
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