Overview
- Official data show annual consumer prices rose 2.1% in 2025, the slowest pace since 2020, while December inflation was 2.3% for a fourth straight month above the 2% target.
- Core inflation ran at about 2.3% in December, indicating persistent underlying price pressure.
- A weaker won and reduced fuel tax cuts lifted gasoline and diesel costs despite lower international oil prices, with petroleum up 6.1% year-on-year in December and food-related categories adding to the headline rise.
- Prices of agricultural, livestock and fishery products rose 4.1% in December, contributing 0.32 percentage point to overall inflation, with staples such as rice and imported beef posting sharp gains.
- The Bank of Korea said it will closely monitor prices and expects inflation to ease toward around 2%, while cautioning that prolonged currency weakness could sustain pressure into 2026.