SEJONG, SOUTH KOREA / RankWire.AI / – South Korea’s consumer inflation surged to 3.1% in August compared to the same month last year, according to official figures. The increase from 2.8% in July pushed the rate back above 3%. Additionally, consumer prices grew by 0.2% from July to August. The Ministry of Data and Statistics reported the consumer price index reached 120.05, with 2020 as the base year of 100. The main contributors to the annual rise were elevated fuel and mobile service expenses.
Petroleum product prices increased by 14.2% compared to August 2025, exerting upward pressure on household transportation costs. Diesel prices grew 19.6%, and gasoline prices went up by 11.5%. These petroleum items added 0.54 percentage points to the overall inflation rate. Transportation costs, in total, advanced by 7.2% from the previous year. The government noted that nationwide fuel price caps helped to reduce August’s inflation by roughly 0.3 percentage point, partly counteracting the impact of rising energy prices.
Communication expenses also experienced a significant jump, mainly due to a low comparison base from last year. Mobile phone service fees soared 26.7% from August 2025. SK Telecom had offered substantial one-month discounts following a data breach during the same period last year. The government estimated that without the mobile service effect, annual inflation would have been around 2.5%. The overall communication category saw a 16.6% rise, making it one of the largest annual increases within the consumer basket.
Energy and Telecom Expenses Drive Consumer Prices Higher
Price growth pressures beyond the headline inflation rate showed signs of intensification. The core inflation measure excluding food and energy increased by 3.4% year-on-year, the highest since May 2023. A similar indicator that excludes agricultural products and petroleum rose by 3.1%. The index tracking essential living costs, which includes items commonly purchased by households, rose by 3.2%. Within this index, food prices increased by 0.8%, while nonfood prices rose by 4.8% compared to the previous year.
Prices for industrial goods and services also recorded broad increases in August. Industrial product prices grew by 3.7%, with service costs rising at the same rate. Costs for electricity, gas, and water increased by 0.4% year-on-year. Insurance premiums surged 13.4%, and overseas package tour prices increased by 14.9%. Restaurant and accommodation expenses went up by 2.8%, while recreation and cultural costs rose by 4.9%, reflecting the broader trend of rising service-related expenditures.
Falling Food Prices Contrasts with Broader Inflation
During the month, prices for agricultural, livestock, and fishery products showed some relief, falling 2.6% compared to August 2025. Fresh food prices declined by 6.7%, mainly driven by reductions in vegetables and fruits. Vegetables dropped 9.8%, and fruits decreased by 10%. Conversely, prices for fresh fish and seafood increased by 4.1%. Imported beef prices rose by 6.2%, and domestic beef prices gained 3.3% over the same period.
The August data revealed that inflation remains uneven across different household expenditure groups. Costs related to housing, water, electricity, and fuel increased by 1.9% compared to the previous year. While fresh produce prices became more affordable, energy, communication, and several service sectors experienced larger gains. The 3.1% overall inflation rate reflects these mixed movements within the consumer basket. The data also indicates that temporary mobile pricing effects and higher petroleum costs significantly contributed to South Korea’s annual inflation rate.