Inflation in South Korea eases for the second month in December According to Reuters

© Reuters. FILE PHOTO: Meat restaurant owner Lee Sang-jae cuts meat at a restaurant in Seoul, South Korea, June 23, 2022. Picture taken June 23, 2022. REUTERS/ Heo Ran/File photo

SEOUL (Reuters) – South Korea’s annual consumer inflation eased for a second month in December and fell below market expectations, supporting policymakers’ view that price pressures will gradually ease through 2024.

December’s consumer price index (CPI) rose 3.2%, compared with November’s rise of 3.3%, and was weaker than the average rise of 3.3% estimated in a Reuters poll.

The index stagnated on a monthly basis.

Inflation data on Friday supported the Bank of Korea’s view of the near-term inflation trajectory, which is that price pressures will gradually ease near the bank’s 2% target by the end of next year as policymakers prepare for monetary policy. release.

For the full year 2023, consumer inflation eased to 3.6% from 5.1% in 2022.

Most economists believe the BOK has reached its maximum rate and expect it to start easing policy from the third quarter of next year as cooling inflation makes a restrictive rate of 3.50% difficult to justify to the public.

A breakdown of the data showed fresh food prices rose 14.5% year-on-year in December, but manufactured goods rose 2.1% year-on-year, slowing from 2.5% in November.