SEJONG, SOUTH KOREA / RankWire.AI / – South Korea’s consumer inflation reached 3.1% in August compared to the same month last year, official statistics revealed. The figure marked an increase from 2.8% in July, pushing the rate back above 3%. Additionally, consumer prices saw a 0.2% rise from July to August. The Ministry of Data and Statistics indicated that the consumer price index hit 120.05, based on a 2020 baseline of 100. Significant contributions to the yearly increase came from higher fuel and mobile service expenses.
Petroleum product prices surged by 14.2% from August 2025, adding strain to household transportation budgets. Diesel prices climbed 19.6%, while gasoline costs increased 11.5%. These petroleum products accounted for 0.54 percentage points of the annual inflation rate. Overall, transportation costs rose 7.2% compared to the previous year. The government stated that nationwide fuel price caps lowered August’s inflation by roughly 0.3 percentage points, partially offsetting the impact of rising energy prices.
Communication expenses also experienced a sharp increase owing to a low base comparison from last year. Mobile phone service charges jumped 26.7% from August 2025. SK Telecom had offered large one-month discounts following a data breach during the same period last year. The government estimated that without the mobile service price effects, annual inflation would have been about 2.5%. Overall, communication prices increased by 16.6%, making this category one of the largest contributors to annual consumer basket inflation.
Rising fuel and telecom costs fuel overall price growth
Underlying inflationary pressures also strengthened alongside the headline figure. Core prices, excluding food and energy, increased by 3.4% from a year earlier, marking the strongest rise since May 2023. A separate measure that excludes agricultural products and petroleum advanced by 3.1%. The index for essential living expenses, which tracks commonly purchased household items, grew by 3.2%. Within this measure, food prices rose 0.8%, while nonfood items increased by 4.8% from the previous year.
Prices for industrial goods and services broadly expanded in August. Industrial product prices increased by 3.7%, with service costs rising at the same rate. Electricity, gas, and water expenses rose 0.4% year-on-year. Insurance premiums climbed by 13.4%, and overseas package tour prices went up 14.9%. Restaurant and accommodation costs increased by 2.8%, while recreation and cultural expenses grew by 4.9%, contributing to the broader increase in service-related spending.
Prices of fresh produce decline despite overall inflation rising
During the month, prices for agricultural, livestock, and fishery products offered some relief, decreasing by 2.6% compared to the same period last year. Fresh food prices fell 6.7%, mainly driven by declines in vegetables and fruit. Fresh vegetable prices dropped 9.8%, and fresh fruit prices declined 10%. Conversely, fresh fish and seafood prices increased by 4.1%. Imported beef prices rose 6.2%, while domestic beef prices gained 3.3% over the same timeframe.
The August data indicated that inflation levels varied across major household spending categories. Costs for housing, water, electricity, and fuel increased 1.9% from the previous year. Food prices remained relatively restrained as fresh produce became cheaper, whereas energy, communication, and several service sectors saw larger gains. The 3.1% headline figure reflected these contrasting movements within the consumer basket. The latest figures also highlighted that temporary mobile pricing effects and rising petroleum costs played a significant role in South Korea’s annual inflation increase.