South Korea’s headline inflation likely to have accelerated in January on rise in energy, food prices

South Korea’s headline inflation is likely to have accelerated in January on increase in food and energy prices. The CPI inflation is expected to have increased both on a sequential basis and year-on-year basis. Prices of food are expected to have risen rather considerably in January because of seasonal patterns.

The recent increase in energy prices accelerated in January. Core sectors including manufacturing goods and services prices might extend stable and relatively low inflation. Core inflation is expected to drop slightly on a year-on-year basis.

South Korea’s headline inflation is expected to reach 2 percent in February or in March as base effects from energy prices might be the most robust at that point, noted Societe Generale in a research report. Headline inflation is likely to remain in the range of 1.5 percent to 2 percent following that, added Societe Generale.