Consumer prices rise by 1.5% in Sept.

Consumer prices rose by the highest rate so far this year, providing an alarm signal for Korea's lagging economy. The Ministry of Finance and Economy's report on the trend of consumer prices for September revealed that consumer prices rose 1.5% from the previous month.

The rise in consumer prices in September is twice the August rate of 0.8% and the highest rate so far this year. Moreover, it is 3.5% higher than the end of last year and 3.9% higher than the same period last year. Consequently, average consumer prices rose 2.1% from the same period last year until September, nearing the government's target rate of 2.5%.

According to the National Statistical Office, consumer prices for subsistence goods directly related to the daily lives of the people rose 2.3% in September and 5.2% from the end of last year, indicating that effective consumer prices rose higher than average consumer prices.

MOFE director Oh Kap-Won asserted that the sharp rise in consumer prices in September was due to the soaring prices of farm, agriculture and marine products, which were wracked by two hurricanes, combined with the hike in petroleum-related products and the increase in salaries for the medical sector.

During the month, prices for farm, agriculture and marine products rose 5.5% and public serve fees, including those for medical services and mass transportation, rose 2.6%, while the prices of petroleum and industrial products rose 0.6%.

On the other hand, prices for suppliers rose 0.6% from the previous month, 1.2% from the end of last year and 2.5% from the same period last year, lower than the rate of increase for consumer prices.

Kwon Soon-Hwal shkwon@donga.com