SEOUL, Sept. 8 (Korea Bizwire) — South Korea’s consumer price growth is anticipated to hit a record low level this year due mainly to declines in prices of agricultural and petroleum products, market watchers said Sunday.
South Korea’s consumer prices inched up 0.5 percent over the January-August period, marking the lowest figure since Statistics Korea started compiling related data in 1965.
The January-August figure even fell below 0.6 percent growth posted for the same period in 1999 and 2015.
In August alone, South Korea’s consumer prices remained unchanged, staying below the 1 percent threshold for the eighth consecutive month.
The South Korean government earlier suggested a 1.6 percent growth in consumer prices for all of 2019, which was later revised down to 0.9 percent in July.
Asia’s No. 4 economy is unlikely to meet the new target as well, market watchers said.
South Korea posted an annual consumer price growth below 1 percent two times, in 1999 and 2015, when the country’s economy was struck hard by the Asian financial crisis and the outbreak of the Middle East Respiratory Syndrome (MERS), respectively.
The Bank of Korea said South Korea may remain unchanged for one or two months in the second half of 2019, due to the base effect from the sharp growth posted last year.
The declines in prices of agricultural and petroleum products will also continue to weigh on consumer prices here, the central bank added.
According to the Korea Center for International Finance, nine global investment banks suggested an annual consumer price growth of 0.7 percent as of August, with some institutions even suggesting an outlook of 0.4 percent.