South Korea consumer inflation rose 2.2% in January, above market expectations

South Korea’s consumer inflation quickened to a six-month high in January, government data showed on Wednesday, coming in higher than market expectations on pressure from a weak local currency.

The consumer price index (CPI) rose 2.2% from a year earlier, after climbing 1.9% in the previous month, according to Statistics Korea. That compared with a median 1.97% increase forecast in a Reuters poll.

Inflation accelerated for the fourth straight month and marked the fastest since July 2024. It was also higher than the central bank’s medium-term target of 2%.

Last month, the Bank of Korea unexpectedly kept its policy interest rate unchanged, after two straight meetings of rate cuts, signaling that it needed to wait for the domestic political turmoil weighing on the currency to stabilize before it could make further cuts.