S Korea’s inflation to hit 14-year high in 2022

South Korea’s headline inflation is expected to hit a 14-year high this year on growing inflationary pressures both from the demand and the supply sides, a central bank report said Tuesday.

The Bank of Korea (BOK) said in the report on situations to meet its inflation target that there was a possibility for this year’s consumer price inflation to top 4.7 percent tallied in 2008 when consumer prices surged.

The BOK noted that the inflation was forecast to surpass the May outlook when considering the changed conditions such as higher global price for crude oil.

On May 26, the central bank revised up its outlook for this year’s consumer price inflation by 1.4 percentage points to 4.5 percent, raising its benchmark interest rate by a quarter percentage point to 1.75 percent. It marked the fifth interest rate hike since August last year as the headline inflation far exceeded the BOK’s inflation target of 2 percent.