The heavy rain and heat waves in July raised the consumer price index growth rate by 0.3 percentage points in the third quarter. With the increasing frequency of climate anomalies, it is being diagnosed as a negative factor for economic growth.
According to the Bank of Korea's report titled "Impact of recent heavy rain and heat waves on growth and prices," released on the 31st, the results of reflecting the damage from July's heavy rain (precipitation of more than 30 mm per hour) and heat waves (daily maximum temperature above 33℃) into the price impact model showed an increase of 0.3 percentage points in the consumer price index growth rate for the third quarter and 0.1 percentage points on an annual basis.
The heavy rain and heat waves caused flooding and quality degradation in agricultural products such as spinach, perilla leaves, peaches, and watermelons, and led to significant livestock and aquaculture deaths.
The frequency of these extreme weather events has clearly increased recently. In the 2020s (based on estimates from 2020 to 2025), the average annual number of heavy rain days was recorded at 49 days and heat wave days at 67 days. This marks an increase of 23.9% and 44.9%, respectively, compared to the average in the 2000s (39 days and 46 days).
Climate shocks are eroding not only prices but also growth rates. Heavy rain causes delays in construction work, while heat waves diminish productivity in agriculture, forestry, fisheries, and service industries.
According to the report, the growth rate in the third quarter, when heavy rain and heat waves are concentrated, is on average 0.1 percentage points lower in the 2020s compared to the 2010s. The Bank of Korea noted in the report, "Extreme weather events can act as downward pressure on potential growth rates through loss of life and property, damage to production facilities, and reduced productivity, thus systematic and proactive policy responses are crucial."
It added, "In particular, the recent surge in damage from heavy rain and floods is due to the fact that Korea's infrastructure was designed based on past climate conditions. It is necessary to proactively reflect long-term climate change scenarios when building infrastructure and disaster response systems."