South Korea’s consumer price inflation slowed to the lowest level in 3.5 years in September, falling below 2 percent for the first time since early 2021, data from Statistics Korea showed.
The consumer price index (CPI) rose 1.6 percent in September from a year earlier, after rising 2 percent in August. September’s figure marked the lowest inflation level since February 2021 when consumer prices grew 1.4 percent.
The Korean government has said that the country is projected to reach the target rate of 2 percent by around the end of 2024, and it saw consumer inflation stay below 3 percent for the sixth consecutive month through September.
The finance ministry expects this year’s prices to rise 2.6 percent.
The reading was below the Bank of Korea’s (BOK) medium-term target of 2 percent. In addition, it comes amid growing talk among policymakers and market participants about an interest rate cut with the next policy meeting on October 11.
In its last meeting, the central bank held interest rates at a 16-year high of 3.50 percent despite slowing inflation and domestic demand due to property market concerns.
South Korea’s inflation data also revealed a 4.1 percent decline in prices of petroleum products and a 0.4 percent dip in private services prices, offsetting increases in agricultural products and public utilities.
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