South Korea's consumer price inflation stays around 1% for 15 months

South Korea's consumer price inflation stayed around 1 percent for 15 straight months on the back of lower commodity prices and weak inflationary pressures on the demand side, a government report showed Tuesday. Consumer prices rose 1.1 percent in January from a year earlier, moving up and down from 1 percent for the 15th consecutive month, according to Statistics Korea. After falling below 2 percent in November 2012, the prices stayed in the 1 percent range till January this year. The prices fell below 1 percent in October last year, but it rose to the 1 percent level a month later. The consumer price inflation staying around 1 percent was attributable to lower prices of imported raw materials and weak demand-side inflationary pressures caused by the still lackluster economic recovery. Core consumer prices, which exclude farm goods and petroleum products, gained 1.7 percent on year in January, down from 1.9 percent in December 2012 and 2 percent in November last year. The so-called livelihood prices, which reflect the costs of key daily necessities, rose 0.6 percent in January from a year ago, staying below 1 percent for five straight months. Fresh food prices, which gauge prices of vegetable and fruit, dropped 12.9 percent on year in January after falling 11.1 percent in the prior month. The prices maintained its downward trend for five straight months. Compared with the prior month, the consumer prices gained 0.5 percent in January after rising 0.1 percent in the previous month. The faster on-month gain came as the Lunar New Year holiday moved to January this year from February last year. It led to stronger demand for farm goods than usual as family members in South Korea are brought together and eat food to celebrate the Lunar New Year. Prices of agricultural, livestock and fishery products increased 2 percent in January from a month earlier. Prices of apple and pear rose 2.9 percent and 2.7 percent respectively, but those for green pumpkin, green chilli pepper and tomato jumped 42. 2 percent, 39.5 percent and 13.2 percent respectively. Prices for electricity, tap water and gas prices increased 2.3 percent in January from a month earlier due to a 5.8 percent hike in city gas prices. Industrial goods prices increased 0.2 percent on month in January due to lower prices of some products such as handbags and toothpaste that dropped 14.3 percent and 13.4 percent respectively. Public service prices gained 0.6 percent last month due to a rise in healthcare service prices. Rent prices rose 0.2 percent, unchanged from the prior month, and private service prices added 0. 4 percent last month amid lower restaurant prices. The Finance Ministry said that the consumer price inflation stayed at a stable level of 1 percent despite a hike in farm goods prices and some services, forecasting that the prices would maintain its stable picture at present. The ministry, however, noted that volatility of agricultural product prices may deepen in accordance with weather conditions such as cold wave and heavy snow, adding that global crude oil prices could fluctuate amid disruption in oil supply.