South Korea's inflation rate has reached its highest level since the Asian financial crisis more than two decades ago, adding to signs of building pressures on the open and trade-dependent economy, and expectations of a lift Interest rates are further set by the Central Bank.
The consumer price index rose 6% in June from a year earlier, the fastest since November 1998, and surpassed the central bank's 2% target for the 15th consecutive month, according to the report. CNBC Arabic reported.
The vulnerability of South Korea to external shocks is apparent, given its heavy dependence on foreign trade and cross-border capital flows.
South Korea is under pressure as money outflows from the local stock market increase and the yuan depreciates.
External factors, such as rising energy, raw material and grain prices, as well as disruptions in the global supply chain, are the cause of high inflation, an official at Statistics Korea said. I don't think I need to add. It certainly appears that the government has few means of responding to external factors of inflation.
