South Korea's producer prices rise over 8% for second month

South Korea's producer prices continued their upward trend in June, with the producer price index (PPI) climbing 8.6% from the previous year. This marks the second consecutive month the index has exceeded the 8% threshold, following a similar rise in May. However, the month-on-month increase halted at 0.0%, breaking a nine-month streak of rising prices.

The year-on-year surge was largely driven by significant price hikes in coal and petroleum products (up 65.8%) and chemical products (up 19.2%), attributed to rising international oil prices. Despite these increases, coal, petroleum, and chemical products saw price decreases compared to the previous month.

Other sectors experienced mixed trends. Electricity, gas, and water prices rose 1.0% month-on-month, primarily due to industrial city gas price hikes. The financial and insurance services sector also saw a 2.5% increase, reflecting higher commission rates linked to stock market gains. Agricultural and fishery products, including pork, rose 0.7% due to continued impacts from the pandemic.

Domestic supply prices, which measure price changes of goods and services supplied domestically, increased by 13.2% year-on-year, the highest since July 2022. This rise was driven by increases in raw and intermediate materials, largely from imported goods. The overall output price index also saw a significant year-on-year increase of 17.6%, the highest since statistics began in 2010, with manufactured goods and services contributing to the rise.