Producer prices hit 6-year low in March

Korea’s producer prices fell to the lowest level in six years due mainly to cuts in energy prices, central bank data showed Wednesday.

The producer price index, which shows inflation pressures before they reach consumers, came in at 98.42 last month, the lowest March reading since 2010, according to preliminary data from the Bank of Korea. From a month earlier, it represented a decline of 0.1 percent. From the same month last year, it was down 3.3 percent. 

The central bank said the decline was largely attributed to cuts in energy prices, including those of coal and oil that plunged 25.7 percent from the same month last year.

While prices of industrial products inched up 0.1 percent from the previous month, prices of electricity, natural gas and water slipped 3.3 percent, the BOK said.

A separate index for agricultural goods slipped 0.2 percent in March from the previous month, though the reading marked a 7.1 percent rise from a year earlier.

Movements in producer price precede movements in consumer price. The BOK on Tuesday said inflation in Korea will likely be 1.2 percent this year, far below its mid-term target of 2 percent.

(khnews@heraldcorp.com)