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. This growth rate surpassed July’s 2.8%, pushing the headline inflation figure above 3%. The consumer price index hit 120.05, with 2020 serving as the base year at 100. Prices also saw a 0.2% rise from July. The Ministry of Data and Statistics announced the August data on September 2.
Fuel prices remained a key driver of inflation during this period. Petroleum products experienced a 14.2% increase compared to the previous year, although the pace of growth slowed from July. Diesel prices jumped by 19.6%, with gasoline prices up 11.5%. These petroleum-related costs contributed 0.54 percentage points to the annual consumer price growth. Since South Korea heavily depends on imported energy, domestic fuel prices are particularly sensitive to fluctuations in global energy markets.
In addition, mobile phone service costs experienced a notable year-over-year rise. Prices for mobile services went up by 26.7% from August 2025, largely due to an unusually low comparison base. Last year, SK Telecom offered substantial discounts for one month following a data breach. Government analyses indicated that without this effect, headline inflation would have been approximately 2.5%. Consequently, this temporary comparison factor played a significant role in August’s annual inflation rate.
Rising fuel and mobile expenses drive overall inflation
August also saw a rise in core inflation, which excludes food and energy. The core consumer prices increased by 3.4% from the previous year, marking the strongest annual core reading since May 2023. Excluding agricultural products and petroleum, the index grew by 3.1%. The index for essential living costs rose 3.2%, with food prices up 0.8% and nonfood items increasing by 4.8%.
Prices across various sectors of goods and services also advanced. Industrial product prices climbed 3.7% year-over-year in August, and service prices increased by the same rate. Electricity, gas, and water costs grew slightly by 0.4%. Insurance premiums surged 13.4% compared to the previous year. Additionally, prices for overseas package tours increased by 14.9%, further contributing to the overall rise in service-related expenses for the month.
Food prices decline while service costs climb
In contrast, prices for agricultural, livestock, and fishery products declined by 2.6% compared to last year, driven mainly by lower prices for vegetables and fruits. Fresh food prices dropped by 6.7% annually, including a 9.8% decrease in fresh vegetables. Meanwhile, fresh fish and seafood prices increased by 4.1%. Imported beef prices rose 6.2%, while domestically produced beef increased by 3.3%.
The August report highlighted uneven inflation across major household expenditure categories. Transportation costs went up by 7.2% from the previous year, while communication expenses increased significantly by 16.6%. Recreation and cultural services rose by 4.9%, and expenses related to restaurants and accommodations increased by 2.8%. Costs for housing, water, electricity, and fuel grew by 1.9%. The government’s estimate suggests that nationwide fuel price caps lowered August inflation by approximately 0.3 percentage points, partially offsetting the impact of rising petroleum prices.