Consumer prices rose by 3.1% in August, marking a return to the 3% range after a month. While prices for agricultural, livestock, and fishery products decreased, the prices of services and industrial goods continued to rise. A significant increase in mobile phone fees, attributed to a base effect from last year's discounts, contributed to the overall inflation rate. Excluding volatile items, core inflation also surged to the mid-3% range.
According to the National Data Agency's 'Consumer Price Trends for August 2026' released on September 2, the consumer price index reached 120.05 (2020=100), reflecting a 3.1% increase compared to the same month last year. After recording 3.1% in May and 3.2% in June, the inflation rate dropped to 2.8% in July but rebounded to the 3% range after two months. Month-over-month, prices rose by 0.2%.
By category, prices for agricultural, livestock, and fishery products fell by 2.6% compared to the same month last year, influenced by increased supply and government discount events. However, some frequently purchased items, such as rice (6.2%), mackerel (6.5%), domestic beef (3.3%), imported beef (7.4%), and eggs (5.2%), saw price increases.
In contrast, industrial goods and services each rose by 3.7%. Within industrial goods, petroleum products surged by 14.2%, maintaining a double-digit increase. Diesel prices rose by 19.6%, gasoline by 11.5%, and kerosene by 19.7%. However, the increase in petroleum prices was slightly lower than the previous month.
The rise in service prices was significantly influenced by mobile phone fees, which increased by 26.7% compared to last year due to a base effect from a 50% discount offered by telecom companies in August 2025. Consequently, public service prices rose by 6.5% year-on-year, a substantial increase from the previous month's rate of 1.4%.
Lee Doo-won, an economic statistics officer at the National Data Agency, explained, "The base effect from last year's fee reductions accounts for approximately 0.58 percentage points. Without this effect, overall inflation appears to be around 2.5%."
Core inflation also saw a significant rise. The index excluding food and energy increased by 3.4% compared to the same month last year, up 0.8 percentage points from the previous month (2.6%). This is the highest rate since May 2023, when it reached 3.8%. The index excluding agricultural products and petroleum also rose by 3.1%, marking the highest level since December 2023.
Prices for processed foods also increased significantly, rising by 1.5% year-on-year, an increase of 0.5 percentage points from July's 1.0%. This is attributed to the recent price hikes in processed food products being gradually reflected in consumer prices. Prices for bread, snacks, and noodles have risen.
The living cost index jumped by 3.2% compared to the same month last year. While food prices rose by 0.8%, non-food items increased by 4.8%. As overall prices have climbed back to the 3% range, the burden of perceived inflation continues to be felt, particularly for frequently purchased items.
Lee noted regarding the rise in core inflation, "The base effect from mobile phone fee reductions has had a more significant impact on the index excluding food and energy than on overall consumer prices, as the number of items considered dropped from 450 to 309, amplifying the effect of this base change."
* This article has been translated by AI.
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