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Import prices up for 3rd month in April on weaker won, higher oil prices

Economy 06:00 May 16, 2023

SEOUL, May 16 (Yonhap) -- South Korea's import prices rose for the third straight month in April largely due to a weaker won and the higher price of crude oil, central bank data showed Tuesday.

The import price index rose 0.7 percent in April from a month earlier, following a 0.8 percent increase tallied in March, according to the preliminary data from the Bank of Korea (BOK).

The rise came as the won weakened against the U.S. dollar, driving up the cost of overseas purchases, including crude oil.

Import prices are a major factor that determines the path of the country's overall rate of inflation.

The Korean won averaged 1,320.01 to the U.S. dollar last month, compared with 1,305.73 a month earlier.

The Dubai crude price, South Korea's benchmark, stood at US$83.44 per barrel in April, up from $78.51 the previous month, according to the central bank.

Meanwhile, South Korea's consumer prices grew at the slowest pace in more than a year in April in the latest signal that inflation has receded.

Consumer prices, a key gauge of inflation, rose 3.7 percent last month from a year earlier, compared with a 4.2 percent on-year rise in March, according to the report from Statistics Korea.

It is the first time in 14 months that the on-year inflation growth fell below 4 percent. The figure rose to over the 4 percent level in March last year from a 3.7 percent growth the previous month and jumped to as high as 6.3 percent in July before showing an overall downward trend.

The BOK held its key rate steady at 3.5 percent last month after a rate freeze in February as inflation appears to be easing and concerns are rising over an economic slowdown.

The central bank is scheduled to hold its monetary policy meeting later this month and may face the daunting task of whether to freeze the rate again or raise it.

It is expected to stand pat again amid easing inflation and a slowdown in economic growth.


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