South Korea’s September CPI Rises 2.9%, Returns to 2% Range Despite 14.8% Oil Surge

South Korea’s consumer inflation rate rose 2.9% in September, returning to the 2% range after one month. Agricultural product prices fell, while petroleum prices continued to post double-digit gains in the fallout from the Middle East war.

According to September consumer price data released on Oct. 2 by Statistics Korea, the consumer price index stood at 120.43 last month, up 2.9% from a year earlier. The inflation rate, which had climbed to 3.1% in August, eased by 0.2 percentage point in a month.

Petroleum prices jumped 14.8% from a year earlier. The government said its fuel price cap helped curb inflation pressure. It estimated the program lowered September inflation by about 0.6 percentage point and that, without it, the rate would have reached 3.5%.

By contrast, prices for agricultural, livestock and fishery products fell 0.3%, trimming 0.03 percentage point from headline inflation. The decline was driven by increased shipments of agricultural goods ahead of Chuseok, the Korean harvest holiday, and expanded government discount support.

By category, agricultural product prices fell 4.0%. Livestock and fishery prices rose 3.7% and 4.5%, respectively.

Processed food prices rose 2.1% on higher factory-gate prices. The living essentials price index, a gauge of perceived inflation, climbed 2.5%, while the fresh food index fell 3.3%.

Core inflation, which excludes food and energy, rose 2.8% from a year earlier.