Key facts
- South Korea's import prices fell 2.4% in August from a month earlier.
- This marks the third consecutive monthly decline in import prices.
- A stronger Korean won, which appreciated 6.1% against the U.S. dollar in August, helped offset rising oil prices.
- Dubai crude oil prices increased 15.6% in August.
- Export prices decreased 3.7% in August, the largest monthly drop since December 2022.
South Korea's import prices declined for the third consecutive month in August, with preliminary data from the Bank of Korea showing a 2.4% on-month decrease. This trend was primarily driven by a stronger Korean won, which appreciated by 6.1% against the U.S. dollar during the month. The currency's strength helped to offset a significant 15.6% rise in the price of Dubai crude oil, South Korea's benchmark. The import price index had previously fallen by 1.0% in July and 4.2% in June. The central bank noted that import prices are a key factor influencing inflation by affecting production costs and consumer prices across the supply chain. In addition to import prices, the export price index also saw a notable decrease, falling 3.7% from the previous month in August. This was the sharpest monthly decline in export prices since December 2022, when the index dropped 6.1%, also attributed to the strong currency.