This photo, taken last Sunday, shows gas prices at a filling station in Seoul. (Yonhap)
South Korea's consumer prices are not expected to sharply rise to top the central bank's 2 percent target even as the country faces upward inflationary pressure, a senior government official said Wednesday.
First Vice Finance Minister Kim Yong-beom said prices of agricultural and livestock products are expected to stabilize on the back of efforts to increase supply and curb the spread of bird flu.
"There is a limited possibility that the growth of consumer inflation will surpass the Bank of Korea (BOK)'s target," Kim said at a press briefing after holding a meeting on the economy.
Still, the official remained guarded against upward price pressures as the Korean economy is recovering and oil prices have shown an uptrend movement.
"Gasoline prices have expanded their upturn and global grain prices have shown strong upward movement," Kim added.
The country's overall inflationary pressure has remained subdued amid the COVID-19 pandemic.
But recent increases in food and oil prices are spawning concerns that inflation may pick up amid economic slumps caused by the coronavirus outbreak.
The country's consumer prices grew 1.1 percent on-year in February, the fastest in one year, up from a 0.6 percent gain in January, led by sharp gains in prices of agricultural and livestock products.
The finance ministry said the growth of consumer prices is likely to temporarily pick up in the second quarter, affected by hikes in food and oil prices.
Last month, the BOK froze its key interest rate at a record low of 0.5 percent amid lingering economic uncertainties over the pandemic. The bank aims to keep annual inflation at 2 percent over the medium term. (Yonhap)