South Korea’s producer prices rose for the third straight month in August, largely due to higher fresh produce costs from the record-long rainy season.

The producer price index ticked up 0.5 percent in August from a month earlier to 103.19, picking up from July’s 0.2 percent gain, according to the Bank of Korea on Tuesday.

Compared with the year-ago period, producer prices fell 0.5 percent in August and extended the decline for the sixth straight month. The pace of decline, however, slowed from the 0.8 percent drop in July.

Agricultural product prices soared 16.0 percent in August versus the previous month due to the longest-ever rainy season that began on June 24 and lasted for 54 days.

Livestock and fishery product prices slipped 2.3 percent and 3.0 percent, respectively, in the same period.

The service price index climbed 0.3 percent to hit an all-time high of 107.18.

Finance and insurance service costs jumped 1.3 percent on the latest stock market rally. Restaurant and accommodation costs also gained 0.4 percent during the summer vacation season.

Factory product prices edged up 0.2 percent in August. Primary metal products rose 1.6 percent while coal and petroleum products gained 0.8 percent.

Electricity, gas, water and waste costs inched up 0.2 percent on month.

Korea’s headline inflation has stayed near zero since April as the coronavirus outbreak sapped domestic demand. In August, consumer prices gained 0.7 percent from a year earlier, rising at their fastest pace since March due to a spike in fresh food prices.

The central bank in August kept its policy rate steady at a record low of 0.5 percent after cutting it by a quarter percentage point in May.

By Kim Hyo-jin

[ⓒ Pulse by Maeil Business Newspaper & mk.co.kr, All rights reserved]