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South Korea Inflation Hits 3.2%, Fuels July Rate Hike Expectation

7/3/2026

Summary

South Korea Inflation

South Korea's consumer inflation rose 3.2% in June, since Dec 2023, prompting expectations of a July 16 rate hike.
CPI rose 0.1% MoM, matching forecasts as higher oil prices and a weaker won lifted import costs.
On May 28 the board voted 5-2 to keep the policy rate at 2.50% while members favored a 25-bp hike.
Two-thirds of May-surveyed economists expected at least one rate increase by September, June’s inflation adding weight.

Summary

South Korea Inflation

The Ministry of Finance and Economy said the fuel-price-cap kept June inflation at 3.2% vs 3.6%.
Fuel prices rose 24.7% year-on-year in June, the fastest since July 2022.
Agricultural prices rose 3.2% year-on-year, with beef up 7.5%, rice up 11.7% and green onion up 37.1%.
International flight tickets surged 28.2% in June, adding to costs while Bank of Korea warned inflation will stay elevated amid volatility, linking the spike to the Middle East war.

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South Korea Inflation

South Korea's consumer inflation rose 3.2% in June, since Dec 2023, prompting expectations of a July 16 rate hike.
CPI rose 0.1% MoM, matching forecasts as higher oil prices and a weaker won lifted import costs.
On May 28 the board voted 5-2 to keep the policy rate at 2.50% while members favored a 25-bp hike.
Two-thirds of May-surveyed economists expected at least one rate increase by September, June’s inflation adding weight.

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