Consumer Price Growth Slows in August
By Park Hyong-ki
Staff Reporter
Consumer price growth slowed in August as crude oil and other raw material prices dropped, showing signs of stabilizing.
According to the National Statistical Office (NSO), Monday, consumer prices rose 5.6 percent in August from a year earlier, showing a slower growth from a 5.9 percent gain the previous month.
This is the first time the consumer price growth has slowed in six months. Since February this year, consumer prices have soared, spurred by skyrocketing oil and raw material prices.
In July, consumer prices rose 5.9 percent, the highest since November 1998 when prices jumped 6.8 percent.
Additionally, last month's consumer price index fell 0.2 percent from 111.2 to 111, the first decrease since November 2006 when the index saw a drop of 0.5 percent.
``The drop is attributable to a steep fall in oil prices after hitting a record high in July,'' said an NSO official.
The government initially projected the consumer prices to exceed 6 percent this month, noting that the country paid a record-high price for a barrel of crude oil over the past couple of months.
Prices of gasoline and other oil products, however, dropped an average of 6 percent in August, making the overall consumer prices decrease, the NSO said, adding that this put overall downward pressure on prices of industrial products.
However, analysts warned crude oil prices may further escalate as Hurricane Gustav is moving toward the Gulf Coast.
Also, the cost of living index, consisting of food and other daily necessities, rose 6.6 percent last month from a year ago, but down from a 7.1 percent gain in July, meaning that consumers felt less burdened by inflation.
Of 53 necessities, 23 saw their prices surge last month with the cost of cabbages rising the highest at 45 percent, followed by radish at 19 percent.