SEJONG, SOUTH KOREA / RankWire.AI / – South Korea’s consumer prices increased by 3.1% in August compared to the previous year, according to official statistics. This uptick represents a rise from 2.8% in July, pushing the headline inflation rate above 3%. The consumer price index reached 120.05, with 2020 serving as the baseline of 100, and prices edged up 0.2% from July. The Ministry of Data and Statistics published the August data on September 2.
During the month, fuel costs remained a key contributor to the inflationary pressure. Petroleum product prices increased 14.2% from a year earlier, although the rate of growth slowed compared to July. Diesel prices surged 19.6%, and gasoline prices went up 11.5%. Petroleum products added 0.54 percentage points to the annual consumer price increase. South Korea’s dependence on imported energy makes domestic fuel prices highly responsive to fluctuations in global energy markets.
Mobile phone service fees also experienced a notable annual rise. Prices for mobile services climbed 26.7% from August 2025, partly due to a low comparison base. Last year, SK Telecom had offered substantial discounts for one month following a data breach. Government estimates indicated that without the mobile service effect, headline inflation would have been approximately 2.5%. This temporary comparison factor thus contributed significantly to the August annual inflation rate.
Fuel and mobile charges push inflation higher
Inflation excluding food and energy, known as core inflation, also strengthened in August. The core consumer price index rose 3.4% year-over-year, marking the highest annual core inflation since May 2023. Excluding agricultural products and petroleum, the index increased by 3.1%. The index tracking living essentials climbed 3.2%, with food prices up 0.8% and nonfood items rising 4.8%.
Overall, broader price data indicated rises in industrial goods and services. Prices for industrial products increased 3.7% compared to last year in August. Service costs also grew by 3.7%, while electricity, gas, and water expenses rose 0.4%. Insurance premiums jumped 13.4% annually. Additionally, prices for overseas package tours went up 14.9%, contributing to the overall increase in service-related costs during the month.
Food prices decline as service costs climb
Prices for agricultural, livestock, and fishery products moved in the opposite direction, falling 2.6% from a year earlier, driven by lower vegetable and fruit prices. Fresh food prices decreased 6.7% annually, with fresh vegetables dropping 9.8%. While fresh fruit prices fell 10%, fresh fish and seafood prices increased 4.1%. Imported beef costs rose 6.2%, and domestically produced beef prices went up 3.3%.
The August report revealed uneven inflation across major household expenditure categories. Transportation costs increased 7.2% year-over-year, and communication expenses rose 16.6%. Recreation and cultural spending went up 4.9%, with restaurant and accommodation prices increasing 2.8%. Housing, water, electricity, and fuel expenses grew 1.9%. The government estimated that nationwide fuel price caps reduced August inflation by roughly 0.3 percentage points, partially offsetting the impact of rising petroleum prices.