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Producer prices fall for 1st time in 3 months in August: BOK

Published: 23 Sep. 2025, 08:47 Updated: 23 Sep. 2025, 14:58

The SK Telecom logo is seen at a retail branch in Seoul on Aug. 27. [YONHAP]

Korea's producer prices fell from a month earlier in August, marking the first drop in three months, due mainly to a sharp decline in mobile phone charges on discounts offered by a major carrier following a data breach incident, central bank data showed Tuesday.

The producer price index, a key barometer of consumer inflation, fell 0.1 percent in August from the previous month to 120.12, according to preliminary data from the Bank of Korea (BOK).

I
t marks the first on-month decline since May, following gains of 0.1 percent in June and 0.4 percent in July.

From a year earlier, producer prices rose 0.5 percent in August, extending their on-year growth streak to 25 months.

Prices of agricultural and livestock products rose 3.4 percent on-month in August due to tighter supply amid unfavorable weather conditions.

In contrast, coal and petroleum product prices fell 1.1 percent.

Service prices declined 0.4 percent, led by a 26.2 percent plunge in telecommunications services.

"The drop in telecommunications service prices was driven by SK Telecom's fee cuts. Excluding that factor, producer prices would have risen by an estimated 0.2 percent from a month earlier," BOK official Lee Moon-hee told a press briefing.

The major wireless carrier offered a 50 percent discount on August bills for more than 20 million users following a data breach incident.

Producer prices are one of the key indicators that determine the trajectory of inflation, as they influence the prices businesses charge consumers in the months ahead.

The domestic supply price index, which accounts for both producer prices and import prices, increased 0.2 percent on-month in August on rising prices of raw materials, according to the data.

In August, consumer prices, a key gauge of inflation, gained 1.7 percent from a year earlier, logging the slowest growth in nine months.

Yonhap