Seoul, June 21 (QNA) - South Korea's central bank said Tuesday it expected inflation to grow at a faster pace than previously anticipated and possibly hit the highest level in 14 years for this year as price pressures are mounting from rising demand and a tight supply.
The updated projections came about a month after the Bank of Korea (BOK) sharply revised up its inflation forecast for this year from 3.1 percent to 4.5 percent at a monetary policy board meeting, according to South Korea's News Agency (Yonhap).
"The future price trend is expected to surpass our forecast made in May given changes in various circumstances, including accelerating international oil prices," the BOK said in a biannual report on inflation. "There is a possibility that this year's price growth exceeds the level (of 4.7 percent) in 2008."
"Going forward, consumer prices will likely continue their upward move by staying over a 5 percent rise for the time being as inflation pressures are mounting from both the supply and demand sides," it added.
South Korea has been facing rising inflation pressures from rebounding consumption from the pandemic, high-flying crude oil and commodity prices amid supply chain disruptions worsened by the ongoing war in Ukraine.
The country's consumer prices jumped 5.4 percent on-year in May, the fastest rise in almost 14 years.
In a bid to tamp down inflation, the BOK hiked its policy rate by a quarter percentage point to 1.75 percent in May, the fifth increase since August last year. (QNA)
21 June 2022
S.Korea's Central Bank Expects 2022 Inflation to Hit Highest Point in 14 Years
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