SEOUL, June 4 (Xinhua) -- South Korea's consumer price inflation fell below 2 percent in five months owing to lower prices for agricultural products and cheaper crude oil, statistical office data showed Wednesday.
Consumer price index (CPI) gained 1.9 percent in May from a year earlier, according to Statistics Korea.
The headline inflation slipped below the Bank of Korea (BOK)'s mid-term inflation target of 2 percent after recording 2.2 percent in January, 2.0 percent in February, 2.1 percent in March and 2.1 percent in April.
The price for agricultural, livestock and fishery products rose 0.1 percent last month, slower than a growth of 1.5 percent in the previous month.
Agricultural products price tumbled 4.7 percent as favorable weather conditions increased vegetable crop, dragging down the overall inflation by 0.2 percentage points.
Those for livestock and fishery products advanced 6.2 percent and 6.0 percent each.
Prices for apple, pear, oriental melon, tomato, green onion, and kimchi cabbage decreased in double digits, but prices for garlic and white radish increased in double figures.
Prices for pork, beef and imported beef mounted in single figures, while the mackerel price swelled 10.3 percent.
Price for industrial products, including oil products, expanded 1.4 percent in May, slightly lower than an increase of 1.5 percent in the prior month.
Oil products price declined 2.3 percent in May on a yearly basis due to cheaper crude oil, but processed food price spiked 4.1 percent.
Prices for gasoline and diesel fell 3.9 percent and 2.6 percent each, but the price for liquified petroleum gas (LPG) soared 12.2 percent last month.
The Price of electricity, natural gas and tap water climbed 3.1 percent, pulling up the overall inflation by 0.12 percentage points.
City gas charges, heating costs and waterworks fees went up in single digits, but the electricity bill was down 0.4 percent.
The private service price, including eating-out cost, surged 3.2 percent last month, lifting the inflation by 1.08 percentage points. Public service price added 1.3 percent.
The eating-out expense was up 3.2 percent, and the private service price, excluding the dining-out cost, gained 3.1 percent.
Housing rent, including Jeonse and monthly rent, inched up 0.8 percent in May from a year earlier.
Jeonse is South Korea's unique contract between two households where a landlord grants the two-year residential right to a tenant, who in turn lends a certain amount of money, or deposit, to the landlord.
The livelihood items index, which gauges price for daily necessities, added 2.3 percent in May on a yearly basis, but the fresh food index, which measures the price for fish, shellfish, fruit and vegetables, retreated 5.0 percent.
Demand-side inflationary pressure became weaker. Core consumer price index, which excludes volatile agricultural and oil products, appreciated 2.3 percent in May, slower than an expansion of 2.4 percent in the previous month.
The OECD-method core price, excluding volatile energy and food costs, gained 2.0 percent in May after rising 2.1 percent in April.
Overall inflationary pressure remained amid recent policy rate cuts. The consumer price inflation showed an upward tendency after bottoming at 1.3 percent in October last year.
The BOK cut its benchmark interest rate by 25 basis points in February and May each to 2.50 percent after lowering it by the same basis points in October and November last year. ■
