South Korea’s consumer price inflation is projected to rise in August, according to the Bank of Korea.
The central bank attributes the expected uptick to a combination of statistical base effects and persistent cost-push pressures stemming from ongoing tensions in the Middle East.
75% in July—the first hike since 2023—any further inflationary pressure could influence the pace of future tightening.
This follows a July reading where the consumer price index rose 2.8% year-on-year, driven by sustained high oil prices that continue to weigh on household budgets and corporate input costs.
The persistent elevation in headline inflation underscores the external risks facing the Korean economy.
The Bank of Korea’s assessment highlights how geopolitical instability continues to feed through to domestic price levels, complicating the monetary policy outlook.
With the central bank having raised its benchmark rate to 2.75% in July—the first hike since 2023—any further inflationary pressure could influence the pace of future tightening.