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Producer prices in South Korea fell for the first time in almost 12 months in October, with the Producer Price Index (PPI) - a barometer to gauge future consumer inflation – coming down from the peak of last month.
October’s PPI fell 0.4% from the previous month to 105.41 points. But the index was 2.2% higher than a year ago, preliminary data from the Bank of Korea revealed.
September saw South Korea’s PPI reach a revised 105.81 points, making it the highest level since August 2013, which saw the index also hitting 105.81 points.
Prices of agricultural, forestry and marine products shrank 9.7% from a month ago, while prices of electric power, gas and water supply were unchanged at 0.0%. Services, and manufacturing products also saw prices unchanged from the previous month.
The major contributor to the drag in producer prices last month was from agricultural foods and livestock products, which saw prices falling double-digits, down 12.3% and 10.6%, respectively.
South Korea’s economy is expected to continue its steady pace of growth for this year, the country’s central bank had said in a statement last month. For this year and next year, the country is expected to grow by 2.7%.
South Korea’s Finance Minister Kim Dong-Yeon warned recently on “external risks” that could worsen the country’s economic outlook and has pledged to come up with ways to boost growth. The country has been attempting pre-emptive measures to support the economy, by giving handouts such as financial measures to help smaller companies as well as a fuel tax cut.