S. Korea's producer price index in August reaches all-time high
Updated: 2021-09-24 12:05:05 KST
South Korea's producer prices, a key barometer of future consumer inflation reached an all-time high in August.
They rose for the tenth month in a row which is the second longest period that the prices have risen since records began in 1965.
The Bank of Korea said on Friday that its producer price index stood at one-hundred-10.7-2, up point-four percent on-month.
It was also up 7.3 percent on-year, the biggest increase in a decade.
"The higher producer prices were mainly led by agricultural products due to the unusually hot summer and frequent rainfall. They were also driven by higher household demand for livestock products including beef and pork."
The prices of agricultural products increased by 2.1 percent.
The price of spinach skyrocketed by around 86 percent and the price of cabbage soared by roughly 47 percent.
Livestock product prices also rose by 1 percent with beef increasing by around 5 percent and pork by roughly 3 percent.
The central bank also attributed the rise to the higher prices of industrial goods, which edged up by point-4 percent.
That was led by greater demand for chemical and metal products, although some products saw prices fall due to lower global oil prices.
Service prices also edged up by point-3 percent, mainly due to restaurants and accommodation as they hit their peak summer season.
Prices of vacation resorts jumped by around 23 percent and hotels increased by 5 percent.
Also, prices of domestic air services rose by 13 percent with international flights rising by around 2.4 percent.
One expert says producer prices are likely to remain high in the near future.
"Producers price index I think will be very very variable, but it will still be high because the production is being affected by the coronavirus, there is a production bottleneck because a lot of intermediate parts and raw materials are not getting to the factories on time, not only because of problems in production, but also problems in transportation, both in Korea, and internationally, because of the coronavirus."
He added that consumer prices are also expected be high in the coming months.
Eum Ji-young, Arirang News.