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S. Korea's producer price growth slows in May

Jun 10, 2011 Trade

South Korea's producer price growth slowed in May amid eased oil price rises, the central bank said Friday.

The producer price index (PPI), a barometer of future consumer inflation, increased 6.2 percent on-year in May after posting a 6. 8 percent on-year rise in the previous month, the Bank of Korea ( BOK) said in a statement.

Producer prices recorded a 28-month high of 7.3 percent in March, before the growth rate slowed for the second consecutive month in May.

The PPI growth rate, however, breached a six percent mark for the fifth straight months after posting 6.2 percent in January and 6.6 percent in February each, according to the BOK.

From the previous month, producer prices fell 0.1 percent last month, the first monthly drop in 11 months.

The monthly decline was mainly attributable to sharp falls in fresh vegetables and falling oil product prices, the BOK said.

Prices for agricultural, livestock and fishery products sank 6. 4 percent in May from a month earlier, with fresh vegetables and fruits plunging 17.8 percent and 20.1 percent each on an on-month basis.

Manufactured goods continued their upward trend, but its growth rate slowed in May due to lower oil prices.

Prices of industrial goods rose 0.2 percent on-month in May, down from a 0.8 percent on-month rise tallied in the previous month.

Oil product prices fell 0.6 percent on-month in May, and chemical goods price growth slowed to 0.7 percent last month from 1.8 percent in April on an on-month basis.