New York City
Monday, February 26, 2024
“THE CEO PUBLICATION owns both theceopublication.com and theceopublications.com websites"

Publication

Inflation in South Korea indicates the idea of zero additional hikes

March 8, 2023: In February, South Korea’s consumer inflation reached its lagging speed in ten months, showing views that the central bank is making with its current policy tightening cycle following its held prices continued last month.

Asia’s fourth-significant economy is teetering near the edge of a recession. Policymakers will be wary of overtightening in the face of a slowdown in global development and overseas demand for its huge exports, like chips and consumer electronics.

On Monday, the consumer price index increased 4.8% in February from a year before, Statistics Korea data showed, which eased from January’s 5.2%. It was less than the 5.1% tipped in a Reuters poll and was also the lowest price since April 2022.

“It was encouraging that the increasing pace of private service prices slowed, which lowers the possibility of additional price hikes by the central bank, nearly on the domestic part,” said Ahn Jae-kyun, a fixed-income analyst at Shinhan Securities.

Annual core inflation, excluding volatile food and energy prices, increased to 4.0% from 4.1% a month before and hit the lowest since August, easing underlying price pressure.

After the CPI release, the Bank of Korea said that the February data came in as anticipated and that the inflation rate would decrease significantly in March and continue to make ease this year but still hold above its mid-term 2% target.

The BOK held interest prices steady the previous month after a year of uninterrupted hikes and said the monetary tightening campaign would not start if inflation followed an expected path towards moderation.

Data out in the previous week showed South Korea could be headed for a recession, with persistently weak exports and domestic retail sales, following a 0.4% contraction last quarter.

By product category, prices of livestock products decreased 3.2% from the last month, and petroleum products slid by 1.3%, pulling the inflation rate lower.

The inflation index rose 0.3% every month, compared with 0.8% in the previous month and 0.5% anticipated by economists.

Finance Minister Choo Kyung-ho said the inflation slowdown would become more apparent in the coming months unless there was an external shock.

The South Korean treasury bond of three years futures increased as much as 0.24 points to 103.49 during the morning classes, also helped by a decrease in U.S. Treasury yields over the weekend.

Get The Latest Updates

Subscribe To Our Weekly Newsletter

No spam, notifications only about new products, updates.
Receive the latest news

Request for online magazine

Join Us

Advertise with us

meteroid vecrtor
Receive the latest news

Contact Us