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. The pace of growth sped up from 2.8% in July, pushing headline inflation above the 3% mark. The consumer price index reached 120.05, with 2020 serving as the base of 100. Prices also saw a 0.2% rise from July. The Ministry of Data and Statistics announced the August figures on September 2.
During the month, fuel expenses remained a significant factor contributing to price pressures. Petroleum product prices increased by 14.2% year-on-year, though the rate of growth slowed compared to July. Diesel prices surged by 19.6%, and gasoline prices went up by 11.5%. Petroleum products contributed 0.54 percentage points to the overall annual consumer price growth. South Korea’s economy heavily depends on imported energy, making domestic fuel costs highly sensitive to global energy market fluctuations.
The cost of mobile phone services also experienced a notable annual rise. Prices for mobile services climbed 26.7% from August 2025, reflecting a low comparison base. Last year, SK Telecom offered significant discounts for one month following a data breach. Government estimates indicated that without the mobile service effect, headline inflation would have been around 2.5%. This temporary comparison factor played a substantial role in the August annual increase.
Rising fuel and mobile service costs drive headline inflation
Underlying inflationary pressures also grew stronger in August. The core consumer price index, which excludes food and energy, rose by 3.4% from a year earlier. This marked the highest annual core inflation reading since May 2023. The index that excludes agricultural products and petroleum increased by 3.1% over the same period. Meanwhile, the index tracking essential living expenses rose by 3.2%, with food prices climbing 0.8% and nonfood items increasing by 4.8%.
Data encompassing broader price movements revealed increases across industrial goods and service sectors. Prices for industrial products rose by 3.7% compared to the previous year in August. Service prices also grew by 3.7%, while costs for electricity, gas, and water increased by 0.4%. Insurance premiums went up 13.4% year-on-year. Additionally, overseas package tour prices rose by 14.9%, contributing to the overall increase in service costs during the month.
Food prices decline while service costs increase
Prices for agricultural, livestock, and fishery products moved in the opposite direction, falling 2.6% from the previous year, mainly due to lower vegetable and fruit prices. Fresh food prices decreased by 6.7% annually, including a 9.8% drop in fresh vegetables. Prices for fresh fruit declined by 10%, while fresh fish and seafood prices rose by 4.1%. Imported beef prices increased by 6.2%, with domestically produced beef prices up 3.3%.
The August report displayed uneven inflation across key household expenditure categories. Transportation costs increased 7.2% compared to the previous year, whereas communication expenses rose 16.6%. Recreation and cultural expenses went up by 4.9%, and restaurant and accommodation costs increased by 2.8%. Housing, water, electricity, and fuel prices rose 1.9%. The government estimated that national fuel price caps lessened August’s inflation rate by roughly 0.3 percentage points, partially offsetting the rise in petroleum costs.