SEJONG, SOUTH KOREA / RankWire.AI / – South Korea’s consumer inflation reached 3.1% in August compared to the same month last year, according to official figures. The figure marked an increase from 2.8% in July, crossing back above the 3% threshold. Monthly consumer prices also experienced a 0.2% rise. The Ministry of Data and Statistics announced that the consumer price index stood at 120.05, using 2020 as the base year with a value of 100. The notable rise was largely driven by higher costs in fuel and mobile services.
Petroleum products experienced a 14.2% increase compared to August 2025, adding to household transportation expenses. Diesel prices surged by 19.6%, and gasoline costs went up by 11.5%. These petroleum-related products contributed 0.54 percentage points to the annual inflation rate. Overall, transportation costs grew 7.2% from the previous year. The government indicated that nationwide fuel price caps helped reduce August’s inflation by approximately 0.3 percentage points, thereby mitigating some impact of rising energy prices.
Communication expenses also saw sharp growth, primarily due to a low base comparison from last year. Mobile phone service fees jumped 26.7% from August 2025. SK Telecom had offered significant one-month discounts following a data breach during the same period last year. Without this mobile service effect, the government estimated that annual inflation would have been around 2.5%. The overall communication category increased by 16.6%, making it one of the fastest rising segments in the consumer basket for the year.
Rising Fuel and Communication Costs Contribute to Price Growth
Price pressures beneath the headline inflation rate gained strength. The core inflation measure, which excludes food and energy, increased by 3.4% year-over-year, marking the highest rise since May 2023. An alternate core indicator, excluding agricultural products and petroleum, rose by 3.1%. The index tracking household essentials climbed 3.2%, with food prices up 0.8% and nonfood items increasing by 4.8% from the previous year.
Broad increases were also observed in industrial goods and service sectors during August. Prices of industrial products rose by 3.7%, matching the rise in service costs. Costs for electricity, gas, and water increased 0.4% from a year earlier. Insurance premiums climbed significantly by 13.4%, while overseas package tour prices rose by 14.9%. Restaurant and accommodation expenses went up 2.8%, and costs related to recreation and culture increased 4.9%, contributing to the overall rise in service-related inflation.
Food Prices Decline Despite Overall Inflation Rising
Prices for agricultural, livestock, and fishery products showed some easing during August, decreasing 2.6% compared to last year. Fresh food items experienced a 6.7% drop, mainly driven by declines in vegetables and fruit. Fresh vegetable prices fell by 9.8%, and fresh fruit prices decreased by 10%. Conversely, prices for fresh fish and seafood moved upward, increasing 4.1%. Imported beef prices rose by 6.2%, while domestic beef costs grew by 3.3% over the same period.
The August inflation data illustrated unevenness across key household expenditure categories. Housing, water, electricity, and fuel expenses increased by 1.9% year-over-year. Although fresh produce became less expensive, energy, communication, and several service categories experienced more substantial gains. The 3.1% headline figure reflected these contrasting trends within the consumer basket. The data also highlighted that temporary mobile pricing effects and higher petroleum costs played a substantial role in South Korea’s annual inflation increase.