{"id":2208638,"date":"2025-03-07T08:00:32","date_gmt":"2025-03-06T23:00:32","guid":{"rendered":"https:\/\/koreapro.org\/?p=2208638"},"modified":"2025-03-06T13:12:22","modified_gmt":"2025-03-06T04:12:22","slug":"south-koreas-inflation-slows-but-households-struggle-with-rising-expenses","status":"publish","type":"post","link":"https:\/\/koreapro.org\/2025\/03\/south-koreas-inflation-slows-but-households-struggle-with-rising-expenses\/","title":{"rendered":"South Korea\u2019s inflation slows, but households struggle with rising expenses"},"content":{"rendered":"<p><span style=\"font-weight: 400;\">South Korea\u2019s <\/span><a href=\"https:\/\/www.moef.go.kr\/nw\/nes\/detailNesDtaView.do?searchBbsId1=MOSFBBS_000000000028&amp;searchNttId1=MOSF_000000000072923&amp;menuNo=4010100\"><span style=\"font-weight: 400;\">consumer prices rose 2.0% year-on-year<\/span><\/a><span style=\"font-weight: 400;\"> in February, slightly easing from January\u2019s <\/span><a href=\"https:\/\/koreapro.org\/2025\/02\/korean-inflation-surges-as-weak-won-drives-up-import-costs-and-energy-prices\/\"><span style=\"font-weight: 400;\">2.2% increase<\/span><\/a><span style=\"font-weight: 400;\">, as slower price growth in energy and agricultural products offset persistent pressures in processed foods and personal services. Core inflation, which excludes volatile food and energy prices, stood at 1.8%, marking a second consecutive month of stability. The government cited exchange rate volatility and global commodity prices as ongoing inflation risks and pledged to continue price stabilization efforts, including tariff adjustments and stockpiling of essential goods.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The Bank of Korea (BOK) <\/span><a href=\"https:\/\/www.bok.or.kr\/portal\/bbs\/B0000502\/view.do?nttId=10090149&amp;searchCnd=1&amp;searchKwd=&amp;depth2=200038&amp;depth3=201263&amp;depth=201263&amp;pageUnit=10&amp;pageIndex=1&amp;programType=newsData&amp;menuNo=201265&amp;oldMenuNo=201263\"><span style=\"font-weight: 400;\">said<\/span><\/a><span style=\"font-weight: 400;\"> the latest inflation data reflects relative price stability but warned that external conditions remain uncertain. While fuel price growth slowed, the weak won continues to elevate import costs, particularly for energy and food. The central bank, which cut its benchmark rate to <\/span><a href=\"https:\/\/koreapro.org\/2025\/02\/south-korea-faces-tense-monetary-future-amid-an-escalating-global-currency-war\/\"><span style=\"font-weight: 400;\">2.75%<\/span><\/a><span style=\"font-weight: 400;\"> in February, signaled a cautious approach to further policy moves, stating that it is unlikely to adjust rates again before the U.S. Federal Reserve shifts its stance. The BOK also highlighted the gap between headline inflation and the public\u2019s perception of rising costs, with the Living Price Index increasing by 2.6% year-on-year.<\/span><\/p>\n<p><b>WHY IT MATTERS<\/b><\/p>\n<p><span style=\"font-weight: 400;\">The South Korean government\u2019s efforts to curb inflation face mounting challenges. Temporary measures \u2014 such as tariff adjustments and food stockpiling \u2014 do not address structural cost pressures tied to the weak won and rising global supply chain costs. With no clear policy shift from the Fed, the BOK is unlikely to adjust rates further without risking renewed downward pressure on the won, potentially stoking further inflation.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Consumers are feeling the squeeze, even as headline inflation stabilizes. Food costs and personal services continue to rise, and households earning stagnant wages are experiencing a different economic reality than what official inflation figures suggest. A sustained rise in the Living Price Index suggests that consumer spending power is weakening.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The upcoming Constitutional Court ruling on President Yoon Suk-yeol\u2019s impeachment could shift economic policy. If the court upholds Yoon\u2019s impeachment, South Korea will enter a snap presidential election cycle, with voting required by May. This could push the ruling People Power Party and the main opposition Democratic Party to pass stimulus measures to boost domestic spending, positioning themselves for an electoral advantage. If economic concerns become a focal point of the campaign, fiscal expansion may take precedence over inflation control.<\/span><\/p>\n<div class=\"content-tags\"><a href=\"https:\/\/koreapro.org\/tag\/business-economy\/\"><span class=\"tag\">Business &amp; Economy<\/span><\/a><\/div>","protected":false},"excerpt":{"rendered":"<p>South Korea\u2019s consumer prices rose 2.0% year-on-year in February, slightly easing from January\u2019s 2.2% increase, as slower price growth in energy and agricultural products offset persistent pressures in processed foods and personal services. Core inflation, which excludes volatile food and energy prices, stood at 1.8%, marking a second consecutive month of stability. The government cited [&hellip;]<\/p>\n","protected":false},"author":10407,"featured_media":2208639,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[30],"tags":[24],"class_list":["post-2208638","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-briefings","tag-business-economy"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v23.7 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>South Korea\u2019s inflation slows, but households struggle with rising expenses - Korea Pro<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/koreapro.org\/2025\/03\/south-koreas-inflation-slows-but-households-struggle-with-rising-expenses\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"South Korea\u2019s inflation slows, but households struggle with rising expenses - Korea Pro\" \/>\n<meta property=\"og:description\" content=\"South Korea\u2019s consumer prices rose 2.0% year-on-year in February, slightly easing from January\u2019s 2.2% increase, as slower price growth in energy and agricultural products offset persistent pressures in processed foods and personal services. 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