The government should not loosen its anti-inflation efforts though consumer price growth declined to the 2-percent range in March, a private think tank warned Sunday.

South Korea’s consumer price index rose 2.6 percent in March from a year earlier, slowing down from a 3.1 percent gain in February and marking the first time since August 2010 that inflation has fallen to the 2 percent range.

“Last month’s slowdown was mainly helped by a low base of comparison and government efforts to clamp down on consumer inflation,” LG Economic Research Institute said in a report.

A recent surge in prices of petroleum and livestock products seems to be dwarfed by a much higher increase in their costs during the same period last year, the report said.

Excluding those factors, the country’s consumer prices increased 3.2 percent last month from a year earlier, it said.

“The government should not loosen its grip on inflation control since there linger adverse factors such as a potential uptrend in international oil prices and possible hikes in public charges,” it said.

The government has been pushing to tame inflation, which usually has a negative impact on the economy by sapping consumer spending.

Last year, the nation’s consumer prices jumped 4 percent from a year earlier, hitting the upper ceiling of the Bank of Korea’s 2-4 percent target band. For this year, Seoul expects consumer prices to go up 3.2 percent. 

(Yonhap News)