South Korea’s consumer price growth remained below the 1 percent mark in June, reflecting the slow growth in service charges and global oil price trend, government data showed Tuesday.

The consumer price index stood at 104.88 last month, down 0.2 percent from the previous month and up 0.7 percent from a year earlier, according to Statistics Korea.

This marked the sixth consecutive month that the on-year growth remained in the zero percent range. It was also the third-longest period that the figure struggled under the 1 percent mark, since the 10 consecutive months observed in 2015 and eight straight months in 1999, the office said.

 

“The taxi fares in some regions have gone up but welfare policies such as high school education expenses and meal costs have expanded and fuel taxes have declined amid the falling global oil prices,” said Kim Yun-sung, director for price statistics.

Restraining the consumer price growth pace were mostly petroleum products and vegetables, which saw an on-year price dip of 3.2 percent and 2.5 percent in June, respectively.

The price of agricultural goods including grains slipped 2 percent from a month earlier but gained 1.8 percent on-year.

Core inflation -- which excludes price-sensitive agricultural and petroleum products -- rose 0.9 percent from a year earlier, the on-year growth figure slipping 0.2 percent from a month earlier.

The latest price indexes have been impacted by external downside factors such as global oil price stabilization and domestic policy actions such as the extended application of health insurance, according to the Ministry of Economy and Finance.

“The government shall continue efforts to stabilize the cost of living expenses,” the ministry said in a release.

Meanwhile, the ministry is set to announce on Wednesday its revised economic policy directions for the second half of the year, reflecting the latest slowdown in production, investment and exports, as well as the prolonged low inflation.

The Bank of Korea is also scheduled to hold its rate-setting Monetary Policy Board meeting later this month, amid lingering speculations that it might lower the base interest rate from the current 1.75 percent in a further easing action.

By Bae Hyun-jung (tellme@heraldcorp.com)