Corona consumption contraction and oil price decline
6.7% of agricultural and marine products such as Chinese cabbage 42%↑
Oil products down by 7%, industrial products by 0.2%↓
Government “Recovery of domestic demand in 2021… Increase rate of increase”
A citizen shopping at a supermarket in downtown Seoul. yunhap news
The inflation rate in 2020 was only 0.5% due to the effects of a decline in consumption and international oil prices caused by the Corona 19 incident. It is below 1% for the second consecutive year following 2019, and this is the first time since related statistics were written.
According to the’December 2020 and Annual Consumer Price Trends’ released by the National Statistical Office on the 31st, the Consumer Price Index in 2020 was 105.42 (2015 = 100), up 0.5% from 2019.
The annual consumer price increase rate remained at the 1% level from 2016 (1.0%) to 2018 (1.5%), and reached 0% in 2020 following 2019 (0.4%). This is the first time since 1965, when related statistics were started, that the rate of increase in consumer prices reached 0% for the second consecutive year.
The annual growth rate of consumer inflation was less than 1% in 2015 (0.7%), when low oil prices and economic sluggishness, and 1999 (0.8%) immediately after the financial crisis, followed by four times last year and this year.
In 2020, service prices only rose 0.3% from 2019. Rents such as cheonsei (0.3%) and monthly rent (0.1%) rose 0.2% and personal services rose 1.2%, but public services such as high school payments (-60.9%) decreased 1.9%.
Compared to this, commodity prices rose 0.9%. The price of agricultural and livestock products such as Chinese cabbage (41.7%) and pork (10.7%) rose 6.7%, recording the highest increase since 2011 (9.2%). On the other hand, due to the 7.3% drop in oil prices as oil prices fell due to the spread of Corona 19 abroad, industrial products fell 0.2%. Electricity, water, and gas also fell 1.4% due to low oil prices.
The agricultural products and petroleum exclusion index (root price) rose 0.7%, recording the lowest increase since 1999 (0.3%), just after the financial crisis. The living price index, which shows the perceived price, rose 0.4%, wider than the previous year (0.2%).
The government predicted that the rate of increase in consumer prices in the new year will be greater than in 2020. The Ministry of Strategy and Finance said, “Consumer prices in 2021 will rise more than in 2020 due to the gradual recovery of domestic demand and easing of downside pressure. I will,” he predicted.
Sejong = Reporter Woo Sang-kyu [email protected]
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