SEJONG, SOUTH KOREA / RankWire.AI / – South Korea’s consumer prices increased by 3.1% in August compared to the same period last year, according to official data. This uptick marked a rise from 2.8% in July, pushing headline inflation back above the 3% threshold. The consumer price index hit 120.05, with 2020 serving as the base year of 100. Additionally, prices climbed 0.2% compared to July. The Ministry of Data and Statistics published the August figures on September 2.
During the month, fuel expenses continued to exert significant pressure on prices. Petroleum product costs rose 14.2% year-on-year, although the pace slowed compared to July. Diesel prices surged by 19.6%, and gasoline prices increased by 11.5%. Petroleum products contributed an additional 0.54 percentage points to the annual consumer price growth. South Korea’s heavy reliance on imported energy makes domestic fuel prices highly sensitive to fluctuations in global energy markets.
The cost of mobile phone services also saw a notable yearly rise. Mobile service charges jumped 26.7% from August 2025, largely due to an unusually low comparison base. Last year, SK Telecom offered substantial discounts for a month following a data breach. Government estimates indicated that, without the impact of mobile service prices, headline inflation would have been around 2.5%. This temporary comparison factor thus played a significant role in the August annual increase.
Rising fuel and mobile costs drive headline inflation
Core inflation, excluding food and energy, also showed an upward trend in August. The core consumer price index rose by 3.4% compared to the previous year, marking the strongest annual core reading since May 2023. The index that excludes agricultural products and petroleum increased by 3.1% over the same period. Meanwhile, the index for living necessities grew by 3.2%, with food prices increasing by 0.8% and nonfood items rising by 4.8%.
Overall price data revealed increases across various industrial products and services. Prices for industrial goods went up by 3.7% from a year earlier in August. Service costs also rose 3.7%, while electricity, gas, and water expenses increased slightly by 0.4%. Insurance premiums jumped 13.4% annually. Additionally, overseas package tour prices increased by 14.9%, further contributing to the rise in service-related expenses during the month.
Food prices decline as service costs climb
In contrast, prices for agricultural, livestock, and fishery products fell 2.6% from the previous year, helped by decreases in vegetable and fruit prices. Fresh food prices declined by 6.7% annually, with fresh vegetables dropping 9.8%. Fresh fruit prices fell 10%, while fresh fish and seafood prices increased by 4.1%. Imported beef prices rose 6.2%, and domestically produced beef prices increased 3.3%.
The August report highlighted uneven inflation across major household categories. Transportation costs increased by 7.2% from the previous year, while communication expenses went up 16.6%. Prices for recreation and culture rose 4.9%, and restaurant and accommodation costs increased by 2.8%. Housing, water, electricity, and fuel expenses grew 1.9%. The government estimated that nationwide fuel price caps reduced August inflation by approximately 0.3 percentage points, partially offsetting the higher petroleum costs.