Korea faces possible 3 percent inflation

Asia's Tech News Daily

Korea faces possible 3 percent inflation

Deputy Prime Minister and Finance Minister Hong Nam-ki. Korea Times file

By Lee Kyung-min

Korea is expected to register inflation of over 3 percent this year, driven by soaring raw material prices compounded further by hesitancy among oil producers.

This bodes ill for the country’s policymakers who have long maintained that the annual inflation will be kept below the Bank of Korea’s target of 2 percent, weakened mostly by the once-assuring claims that the one-off, supply-side complications would have limited impact in the long term.

The figure touching 3 percent, which will be for the first time in a decade since February 2012, is almost certain, since rising commodity and oil prices will translate into higher utility bills.

Further advancing the view is slow yet clear signs of recovery in consumption amid a growing number of economies preparing to “live with” COVID-19, fuel for even sharper, demand-driven inflation.

The 3 percent inflation is highly possible, as implied by an assessment made by a finance ministry official on economic development for October.

“The possibility of 3 percent price growth is not ruled out, because of the base effect from last year,” the official said during a press briefing last week. “Supply-side factors will determine the course of inflation in the coming months,” he added.

The 2 percent target will be exceeded, because the 2 percent range price rises for the past six months since April will not be broken any time soon.

Dubai crude is traded at a seven-year-high of around $80 (95,000 won) per barrel this month, higher than $72.9 and $69.2 in July and August, respectively.

The rise in price led to Korea Electric Power Corp. (KEPCO) raising the electricity rate from the fourth quarter of this year, the first hike since November 2013.

Similarly, the rising price of liquefied natural gas (LNG) is likely to push up energy prices, resulting in higher home heating costs this winter.

A consumption recovery can add inflationary pressure from the demand side.

The Composite Consumer Sentiment Index (CCSI) has continued to hover above 100 for the past seven months since March when the figure was 100.5. An above-100 reading means optimists outnumber pessimists.

Also on the rise is domestic credit card spending with the figure registering an 8.8 percent increase from a year earlier in September. This was eight consecutive months of year-on-year increases since February.

The Ministry of Economy and Finance plans to stabilize the volatility in agricultural produce and utility prices by supply control and a delay in price hikes.

Deputy Prime Minister and Finance Minister Hong Nam-ki said during a National Assembly audit of the ministry Oct. 5 that the government “will not raise natural gas prices in November.”

“Utility prices will not be increased in the latter half of this year. Needed price increases will be delayed until next year,” he said.

Internet Explorer Channel Network
Asia's Tech News Daily
News Related


[Election 2022] AI spokesman, avatars enter election campaigns

AI Yoon Suk-yeol, a digitally-created character speaks in a 1-minute video revealed at People Power Party election committee’s inauguration ceremony on Monday. The AI character said, “Hello. I am AI ... Read more »

Singapore, EU in talks on strengthening bilateral digital trade, forming partnership

Minister-in-charge of Trade Relations S. Iswaran is in Brussels to co-chair a trade committee meeting under the EU- Singapore Free Trade Agreement. SINGAPORE – With an eye on tapping further ... Read more »

Seoul's average apartment price jumps twofold under Moon government: civic group

This Nov. 15 file photo shows a bird’s eye view of an array of apartment compounds in Seoul. Yonhap The average price of Seoul apartments has soared more than twofold ... Read more »

Samyang joins global consortium to promote Allulose in Europe

Samyang Corp.’s production facility in Daejeon / Courtesy of Samyang Corp. By Kim Jae-heun Samyang Corporation has joined hands with global food ingredient manufacturers to target the European food market. ... Read more »

4MEN teams up with Singaporean David Yong for new single, 'My Way'

Singaporean artist-entrepreneur David Yong, second from right, poses with the members of R&B group 4MEN. Courtesy of MAJOR9 By Dong Sun-hwa R&B group 4MEN has teamed up with Singaporean artist-entrepreneur ... Read more »

Trade ministry eases rules for export firms

gettyimagesbank By Lee Kyung-min The government will simplify the administrative procedures for exporters of Korea’s key goods, as part of an expanded compliance program (CP), whereby 156 businesses abide by ... Read more »

Moody's maintains negative outlook for E-mart, SK hynix, SK Innovation

gettyimagesbank LG Energy Solution’s IPO raises positive outlook for LG Chem By Park Jae-hyuk Moody’s Investors Service maintained its negative credit outlook for E-mart, SK hynix and SK Innovation, citing ... Read more »

Politics or misguided conviction? Is Moon obsessed with ending the Korean War?

President Moon Jae-in speaks in a congratulatory video speech at the 2021 Seoul UN Peacekeeping Ministerial in Seoul on Tuesday night. (Yonhap)With the clock ticking on his term in office, ... Read more »

McDonald's debuts Mariah Carey holiday merchandise line ahead of Mariah holiday menu launch

Photo by: McDonald’s Press Release McDonald's keeps the surprises coming for the holidays, and this time, it unwrapped a new line of merchandise featuring Mariah Carey. The items are just ... Read more »

(LEAD) Proportion of 1-person households hits record high of 32 pct last year

(ATTN: UPDATES with more info in paras 4, 12-17; CHANGES headline) SEOUL, Dec. 8 (Yonhap) — The proportion of one-person households in South Korea hit a fresh record high last ... Read more »

S.Korea develops real-time, standoff chemical warfare agent detector

South Korea has developed a Hyperspectral Imaging Stand-off Chemical Agent Detection System. (Agency for Defense Development)South Korea has developed the first domestically developed technology for early detecting chemical weapons attacks ... Read more »

S. Korea establishes new national cemetery on Jeju

This photo, taken on Wednesday, shows the Jeju National Cemetery on the southern island of Jeju. (Yonhap)South Korea on Wednesday opened a new state cemetery for fallen national heroes, including ... Read more »

Household debt, inflation cited as biggest risks to financial system: BOK survey

SEOUL, Dec. 8 (Yonhap) — One out of five financial experts cited high household debt and inflationary buildup as the biggest risks to the financial system, a survey showed Wednesday. ... Read more »

Korea H2 Alliance attracts $1 billion investment for hydrogen business

Kim Min, center, the chairman of Korea H2 Alliance and Kim Si-eun, fifth from left, the CEO of Korea H2 Alliance, pose during a virtual investment agreement ceremony with officials ... Read more »

SK Gas invests in U.S. hydrogen startup in push for clean energy transition

SEOUL, Dec. 8 (Yonhap) — SK Gas Co., a key energy unit of South Korea’s No. 3 conglomerate SK Group, said Wednesday it has invested in a U.S. startup that ... Read more »

Dollar declines to 73.97 rubles on Moscow exchange

Euro grows to 83.48 rubles Read more »

(LEAD) Banks' household loans grow at slower pace in November amid tight lending rules

(ATTN: ADDS more info in paras 4. 6-7, 11) SEOUL, Dec. 8 (Yonhap) — South Korean banks’ loans to households grew at a slower pace in November amid the government’s ... Read more »

Private-sector economists raise Singapore 2022 growth forecast to 4%: MAS survey

MTI had last month said Singapore’s gross domestic product will grow by 3 per cent to 5 per cent next year. SINGAPORE – Singapore’s economy will grow by 4 per ... Read more »

Banks' household loans grow at slower pace in November amid tight lending rules

SEOUL, Dec. 8 (Yonhap) — South Korean banks’ loans to households grew at a slower pace in November amid the government’s stepped-up control on home-backed loans and other lending, central ... Read more »

Nearly 1 in 3 households in S. Korea consists of one person last year

SEOUL, Dec. 8 (Yonhap) — Nearly one in three households in South Korea consists of one person last year, data showed Wednesday, as the number of single-member families has risen ... Read more »

Moon vows to support creation of mutually beneficial local jobs

President Moon Jae-in (Yonhap)President Moon Jae-in pledged Wednesday to provide a variety of support for an initiative to create jobs through joint cooperative projects between local governments, businesses and residents. ... Read more »

Lee pledges to increase budget for startups to 10 tln won

SEOUL, Dec. 8 (Yonhap) — Lee Jae-myung, the presidential nominee of the ruling Democratic Party, said Wednesday he will increase the government’s investment in startups to 10 trillion won (US$8.50 ... Read more »

RBI monetary policy meet today: What to expect

Representative image Before the Omicron variant of COVID-19 took over the epidemiological and markets discourse, there was a reasonable likelihood that the Monetary Policy Committee would signal to the Reserve ... Read more »

Lee pledges to increase budget for startups to W10tr

Lee Jae-myung (2nd from R), the presidential nominee of the Democratic Party, takes a look at products made by small and medium-sized businesses at an industrial complex in southwestern Seoul ... Read more »

Military reports 31 more COVID-19 cases

South Korean soldiers (Yonhap)South Korea’s military on Wednesday reported 31 additional COVID-19 cases, including 28 breakthrough infections, raising the total caseload among its personnel to 2,583. Of the new cases, ... Read more »

S. Korea develops technology for early, real-time chemical agent detection

This conceptual image, provided by South Korea’s state-run Agency for Defense Development, depicts how the Hyperspectral Imaging Stand-off Chemical Agent Detection System works. (South Korea’s state-run Agency for Defense Development)South ... Read more »

Yoon leads Lee by 8.2 percentage points in presidential race: survey

Lee Jae-myung (L), the presidential nominee of the ruling Democratic Party, and Yoon Suk-yeol, the nominee of the main opposition People Power Party, attend the Korea National Prayer Breakfast at ... Read more »

[Contribution] Is inflation really out of control?

Another Great Inflation unlikely today By Stephen Lee Stephen Lee is the chief economist at Meritz Securities, Seoul. Courtesy of Mertiz Securities Inflation has been drifting higher recently, with October’s ... Read more »

Australia weighs central bank digital currency, crypto rules

SYDNEY (BLOOMBERG) – Australia is weighing plans for a central bank-issued digital currency alongside the regulation of the crypto market as it seeks to overhaul how the nation’s consumers and ... Read more »

Korea's daily COVID-19 cases surpass 7,000 for 1st time: PM

Health workers clad in protective suits conduct virus tests on students at an elementary school in the southwestern city of Gwangju, Dec. 7. Yonhap South Korea’s daily COVID-19 cases have ... Read more »

US committed to dialogue with N. Korea despite no success so far: White House czar

Flags of North Korea and the US (123rf)WASHINGTON — The United States remains committed to engaging with North Korea diplomatically despite having no success so far, White House policy coordinator ... Read more »

Renowned accordionist Shim Sung-rak dies at 85

Accordionist Shim Sung-rak / Yonhap By Park Ji-wonShim Im-sub, an accordion virtuoso better known by his stage name Shim Sung-rak, died Saturday. He was 85.According to his acquaintances, Shim underwent ... Read more »

Housing prices have markedly stabilized: finance minister

SEOUL, Dec. 8 (Yonhap) — South Korea’s top economic policymaker said Wednesday housing prices have markedly stabilized on the back of housing supply measures, the central bank’s rate hike and ... Read more »

(EDITORIAL from Korea Times on Dec. 8)

Realizing hydrogen economy: Government’s blueprint is too ambitious to be realistic The government has announced a master plan to transit toward a hydrogen economy by raising the country’s self-sufficiency rate ... Read more »

Export of Russian software up by almost 20% yoy in 2021, says Deputy Prime Minister

Packages of measures aimed at developing the industry are being gradually implemented, Dmitry Chernyshenko said Read more »

Baltic countries starts talks on Russian electricity import increase — operator

According to spokesperson of Estonia’s Elering Ain Koster, Estonia and Latvia earlier reduced the volume of trade with Russia on the basis of Lithuania’s desires Read more »

Settlements with India for weapon supplies are carried out in rubles, rupees

According to Alexander Mikheyev, Rosoboronexport has almost fully abandoned settlement in the US currency Read more »

One of Russia's largest winemakers to export to France

The first batch of wines has been shipped from Fanagoria to the French Auchan retail network Read more »

Economic dynamics in Russia positive in general, says Putin

As the Russian President pointed out, investments were up by 7.6% in first three quarters of this year Read more »

No sun, no stars for six months. How to work and live in the North

The chain of meteorology stations stretches to Chukotka - and at every station people are waiting for the supplies Read more »
On free-english-test.com you will find lots of free English exam practice materials to help you improve your English skills: grammar, listening, reading, writing, ielts, toeic