The Bank of Korea said on the 2nd that "as the living cost inflation rate has risen to the low-to-mid 3% range, the burden of living expenses has grown for vulnerable groups, whose share of essential goods in consumption expenditure is large." The living cost inflation rate in May rose 3.3% from a year earlier, the highest since April 2024 (3.6%).
On this day at the Bank of Korea in Jung-gu, Seoul, the Bank of Korea held a "price conditions review meeting" presided over by Director General Lee Ji-ho and reviewed the future path of prices. Director General Lee said, "In May, consumer prices saw a larger increase in petroleum product prices, and service prices also rose, led by travel-related services such as domestic and international airfares," adding, "The inflation rate in June is expected to be at a similar level to the previous month."
Director General Lee said, "There is high uncertainty in the evolution of the Middle East situation and the resulting trajectory of oil prices," but assessed, "As the oil price shock gradually spills over to other institutional sectors, the inflation rate is expected to remain in the 3% range for the time being."
The consumer price inflation rate in May rose 3.1% from a year earlier, marking the biggest increase in 2 years and 2 months since April 2024 (3.1%). In particular, petroleum product prices rose 24.2% from a year earlier. This was the largest increase in 3 years and 10 months since the 2022 Russia-Ukraine war.