Consumer price hike seen at 2.5 pct without mobile bills: finance ministry

South Korea's consumer prices for August rose 3.1 percent, but excluding a spike in mobile communication bills, the increase may have been closer to 2.5 percent, according to a senior financial official. The spike in mobile bills was due to a temporary 50-percent discount offered in August last year, which created a low base effect, leading to the higher increase, said Kang Gi-lyong during a government meeting.

Mobile phone service charges increased 26.7 percent compared to the previous year, reflecting the impact of the discount. The country's top mobile carrier, SK Telecom Co., provided the discount following a major data breach that affected over 20 million subscribers. The government noted that the country's fuel price cap system currently in place limited consumer price growth by 0.5 percentage point, suggesting the August figure could have been 3.6 percent.

While September's consumer price increase is expected to ease compared to August, there are still risks such as uncertainties in the Middle East and climate factors, according to Kang. The government plans to implement measures to stabilize people's livelihoods ahead of the Chuseok holiday this month.