South Korean inflation data for December 2024
Headline CPI +1.9% y/y, the most rapid rise in 4 months but below the central bank’s 2% target
- expected +1.7%, prior +1.5%
Headline CPI +0.4% m/m
- expected +0.2%, prior -0.3%
Core +1.8% y/y
For the year 2024, inflation came in at +2.3% y/y
- well down on 2023 when it was +3.6%
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Overall, South Korea has experienced a general decline in inflation over the past six months, with rates consistently below the central bank’s target. This trend has influenced monetary policy decisions, including interest rate adjustments, to support economic stability.
Brief summary of inflation developments in H2 of 2024:
July 2024: Inflation slightly increased to 2.55%, indicating a modest rise in consumer prices.
August 2024: The rate declined to 2.01%, reflecting a significant slowdown in price increases.
September 2024: Inflation further decreased to 1.6%, marking the weakest annual increase since February 2021. This decline was below the central bank’s 2% target and economist forecasts, raising expectations for potential interest rate cuts.
October 2024: The rate continued to fall, reaching 1.3%, the lowest since January 2021. This marked the fourth consecutive month of slowing inflation and the seventh month below 3%.
November 2024: Inflation slightly rose to 1.54% year-over-year, up from 1.26% in October. However, there was a month-over-month deflation of 0.25% from October to November
