BOK governor: Consumer prices to rise by about 3% next year

Chon Chol-Hwan, governor of the Bank of Korea, predicted Thursday that the increase rate of consumer prices will remain at around 3 percent and that economic growth will also slow down to 5 to 6 percent.

In a news conference, Governor Chon said that inflationary pressure for next year would be inevitable due to such factors as high international oil prices, hikes in public utility charges and wage increases. Taking all these factors into account, he said, consumer prices are expected to rise by about 3 percent next year.

Along with the projection, the governor indicated the possibility that his bank could adjust the mid-term inflation target of plus and minus 2.5 percent.

In addition, Governor Chon forecast that the economic growth rate will record 5 to 6 percent next year, provided that corporate and financial restructuring proceeds as the government plans and international oil prices do not rise further. He added that it is still difficult to determine if the Korean economy has passed its peak or not.

Meanwhile, the Bank of Korea is scheduled to announce its prospects for next year¡¯s macroeconomic indexes such as the economic growth rate and price increase rate next month.