Reply #46: At 4.2%, inflation is still way above gov’t target [View All]

http://joongangdaily.joins.com/article/view.asp?aid=2935654

Korea’s inflation stayed above the 4-percent level for the fourth straight month in April, though it slowed to 4.2 percent from 4.7 percent in March, a government report said yesterday.

With inflation still high, the central bank may feel pressured to raise interest rates at a monetary policy committee meeting on May 13.

The government also said yesterday that it raised the average price of gas used for heating and cooking by 4.8 percent to reflect rises in international energy costs.

“The government’s price controls seem to be working, but inflation is still above the target and thus the central bank will raise rates next week,” Park Tae-kuen, a fixed-income analyst at Hanwha Securities, told Bloomberg. The government’s inflation target for the year is 3 percent while the Bank of Korea predicts it will be 3.9 percent.