(LEAD) Consumer prices up 3.1 pct in Aug. on fuel, mobile subscription fees

South Korea's consumer prices rose 3.1 percent in August compared to a year ago, driven by elevated oil prices and increased mobile service subscription fees, according to figures released by the Ministry of Food and Drug Safety on September 2. The data showed that consumer price growth surpassed the 3 percent mark in August, a significant jump from the 2.8 percent increase seen in July. The acceleration in August was mirrored in May and June, with rates of 3.1 percent and 3.2 percent, respectively.

Oil prices played a major role in the price surge, climbing 14.2 percent year-on-year in August, down slightly from the 15.6 percent increase reported in July. This rise in oil prices accounted for 0.54 percentage points of the overall consumer price growth in August, a reduction from the 0.6 percentage points seen in July. In the month of August, diesel prices surged 19.6 percent, while gasoline prices increased 11.5 percent.

Given that South Korea depends heavily on imported energy, the increase in oil prices had a considerable impact on the consumer price growth.

Another significant factor in the price hike was the 26.7 percent rise in mobile phone service charges in August, attributable to a low base effect from large-scale discounts offered by SK Telecom following a data breach the previous year. Core inflation, which excludes volatile food and energy prices, also rose 3.4 percent year-on-year in August, marking the highest level since May 2023.

Industrial products prices increased by 3.7 percent, while agricultural, livestock, and fishery product prices dropped by 2.6 percent, primarily due to lower prices of napa cabbage and tomatoes. Imported beef saw a 6.2 percent price increase, while domestically produced beef rose 3.3 percent. Prices in the service sector went up by 3.7 percent, led by higher insurance premiums and overseas package tour prices, which climbed 13.4 percent and 14.9 percent, respectively. Electricity, gas, and water prices increased by 0.4 percent over the same period.