Seoul: South Korea's import prices experienced a decline for the second straight month in March, primarily due to a reduction in global oil prices, as revealed by central bank data on Wednesday. The import price index dropped by 0.4 percent compared to the previous month in March, following a 1.0 percent decrease in February, according to the preliminary data from the Bank of Korea (BOK).
According to Yonhap News Agency, import prices for raw materials decreased by 3.3 percent on a monthly basis in March, while intermediate goods saw a rise of 0.7 percent. This trend was influenced by the average price of Dubai crude, which serves as South Korea's benchmark. The price fell by 7 percent from the previous month, averaging US$72.49 per barrel in March, as per government data.
Despite the monthly decline, the import price index saw a year-on-year increase of 3.4 percent in March. Import prices significantly impact the country's overall inflation rate trajectory. In contrast, the export price index rose by 0.3 percent from the previous month and surged by 6.3 percent compared to the previous year.
Consumer prices, a crucial measure of inflation, increased by 2.1 percent year-on-year in March, accelerating from a 2 percent annual increase recorded in February. The central bank had previously forecasted an annual consumer price growth of 1.9 percent for 2025.
The BOK highlighted uncertainties regarding future import prices, attributing potential volatility to the new tariff scheme implemented by U.S. President Donald Trump's administration and other policy challenges. "Tariffs themselves are not included in the surveyed prices of imported goods, but they can affect global economic conditions, market supply and demand, and pricing strategies by individual companies, which could eventually influence import prices," explained BOK official Lee Moon-hee during a press briefing.