Import prices fall for second month in July

Import prices fell for the second consecutive month in July due to a stronger won and a decrease in oil prices due to protracted Middle East uncertainties, central bank data showed on Friday.

The import price index fell 1 percent on month following a 4.2 percent on-month drop in June, according to preliminary data from the Bank of Korea (BOK).

On an on-year basis, the index climbed 18.7 percent in July.

The BOK said the on-month decline came as the won strengthened against the dollar by 2 percent over the period while the price of Dubai crude, Korea’s benchmark, edged down 3.4 percent.

Prices of raw materials rose 0.8 percent in July from a month earlier, and intermediate goods dropped 2.2 percent over the cited period.

Import prices are a key driver of inflation as they affect production costs and consumer prices throughout the supply chain, according to the central bank.

The BOK data showed that the July export price index rose 1 percent from the previous month from higher electronic prices, despite the strong currency.

Compared to a year earlier, the index jumped 49.1 percent.

Yonhap