South Korea Inflation Hits Five-Month High Exceeding Forecasts June

South Korea's consumer inflation accelerated to 2.2% year-on-year in June 2025, the fastest pace since January and surpassing market expectations of around 2.1%. The increase was driven by rising costs in food, utilities, furnishings, household equipment, and services, despite consumer prices remaining flat on a monthly basis. This inflation uptick follows the Bank of Korea's recent monetary easing, including a 25 basis point rate cut in May, which marked the fourth cut since October 2024 aimed at supporting the economy amid rising US tariffs. Analysts and economists are closely monitoring this inflation trend as it may influence future monetary policy decisions, with potential considerations for tightening if inflation continues to exceed targets. External factors such as global energy prices, supply chain risks, and currency depreciation also contribute to the inflationary pressures. Market participants anticipate insights on the central bank's response at its next policy meeting, balancing inflation control with economic growth support.