South Korea’s consumer prices grew over 4 percent for a second straight month in December, raising worries that inflation could remain a drag on the nation’s economy, a government report showed Friday.
According to the report by Statistics Korea, the country’s consumer price index rose 4.2 percent in December from a year earlier. That followed a 4.2 percent gain in November.
Core inflation, which excludes volatile oil and food costs, grew 3.6 percent from a year earlier, the largest hike for this year. It gained 0.4 percent from the previous month.
For 2011, the nation’s consumer prices advanced 4 percent, meeting the government’s annual inflation target, the report showed.
Inflation exerts negative influence on the economy since high prices can cause consumers to stay cautious about spending. High crude oil, raw materials and food prices have all contributed to inflationary pressure here.
The government expects that things will improve next year, predicting that consumer prices will grow 3.2 percent in 2012, down from this year’s annual target of 4 percent.
The report showed that farm products and oil prices fueled inflationary pressure.
Fresh food prices that include vegetables and fruits dropped 3.6 percent in December from a year earlier, but agricultural, fishery and livestock prices rose 5.8 percent over the same period.
High energy costs drove up manufactured product prices, which jumped 5.3 percent on-year in December. Prices of gasoline and diesel fuel rose 9.6 percent and 14.1 percent, respectively.
Service-sector prices also grew 2.8 percent with home rental prices gaining 5 percent, the report showed.
Taming inflation is one of the top priorities for policymakers.
The Bank of Korea, the nation’s central bank, said on Thursday that its monetary policy goal in 2012 will be to focus on maintaining price stability.
Earlier this month, Finance Minister Bahk Jae-wan said that the nation is facing “tough” inflation conditions as prices of farming goods and energy prices could rise ahead of the full-swing winter season.
(Yonhap News)
