SEJONG, SOUTH KOREA / RankWire.AI / – South Korea’s consumer inflation rose to 3.1% in August compared to the same period last year, according to official figures. This uptick followed a 2.8% increase in July, pushing the rate back above 3%. Consumer prices also grew by 0.2% from July to August. The Ministry of Data and Statistics indicated the consumer price index reached 120.05, with 2020 as its base of 100. The primary contributors to this annual rise were higher costs for fuel and mobile services.
Petroleum product prices increased by 14.2% compared to August 2025, adding financial pressure to household transportation expenses. Diesel costs surged by 19.6%, while gasoline prices went up by 11.5%. Petroleum-related goods contributed 0.54 percentage points to the overall inflation rate. In total, transportation expenses grew by 7.2% year-over-year. The government stated that nationwide fuel price caps reduced August’s inflation by approximately 0.3 percentage points, partially offsetting the impact of rising energy prices.
Costs for communication services also saw a sharp rise, primarily due to a low comparison base from the previous year. Mobile phone service charges jumped 26.7% from August 2025. SK Telecom had offered significant one-month discounts following a data breach during the same period last year. Without the mobile service price effect, the government estimated that annual inflation would have been about 2.5%. Overall, communication costs increased by 16.6%, making it one of the categories with the largest yearly increases in the consumer basket.
Rising Fuel and Telecom Expenses Drive Price Growth
Price pressures outside of food and energy became more evident, with core inflation excluding those categories rising 3.4% from a year earlier—the highest since May 2023. Another measure, excluding agricultural and petroleum products, grew by 3.1%. The index tracking essential living expenses, which covers commonly purchased household items, increased 3.2%. Within this measure, food prices went up by 0.8%, while nonfood prices rose by 4.8% compared to the previous year.
Prices for industrial goods and services also saw broad increases in August. Industrial product costs climbed 3.7%, with service prices rising at the same rate. Utility costs, including electricity, gas, and water, increased by 0.4%. Insurance premiums jumped 13.4%, and overseas package tour prices rose 14.9%. Restaurant and accommodation expenses grew by 2.8%, while recreation and cultural costs increased by 4.9%, contributing to the overall rise in service-related expenditures.
Food Prices Decline Despite Overall Inflation Rising
During the month, prices for agricultural, livestock, and fishery products experienced some relief, falling 2.6% year-over-year. Fresh food prices decreased by 6.7%, mainly driven by declines in vegetables and fruit. Vegetable prices dropped 9.8%, and fruit prices decreased 10%. Conversely, fresh fish and seafood prices increased by 4.1%. Imported beef costs rose by 6.2%, while domestic beef prices gained 3.3% over the same period.
The August data revealed that inflation remained uneven across key household spending sectors. Costs for housing, water, electricity, and fuel rose by 1.9% compared to the previous year. While fresh produce prices eased, energy, communication, and several service categories registered larger increases. The 3.1% headline inflation rate reflects these contrasting movements within the consumer basket. Additionally, the data indicated that temporary mobile pricing effects and higher petroleum costs significantly contributed to South Korea’s annual inflation rate.