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SOUTH KOREA: CPI Moderated in October, Below Consensus.

SOUTH KOREA
GlobalEM BulletBulletSouth KoreaAPACEmerging Market NewsRegion
  • Korea’s October CPI YoY moderated to +1.3% with the MoM figure at 0.00%.
  • Down from +1.6% in September, this was the lowest reading since 2021.
  • Food prices rose +1.4%, and a modest decline in Housing/Utilities to +1.6% from +1.8%.
  • The largest decline in prices was seen in Transport that slipped to -4.0% (from -1.2%).
  • The Bank of Korea has an inflation target of +2.0%.
  • The key piece in this data will be the modest decline in Housing/Utilities; an area of focus given house price inflation in Seoul.
  • The BOK does not meet again until November 28, having cut rates at the most recent meeting.
  • Today’s CPI potentially turns the next meeting into a live one.
  • The market currently has c. 12bps of cuts priced in over the next three months.
  • Following the conclusion of the US Election, it will be interesting to see if the market starts to forecast and price in a further cut at the next meeting. 
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  • Korea’s October CPI YoY moderated to +1.3% with the MoM figure at 0.00%.
  • Down from +1.6% in September, this was the lowest reading since 2021.
  • Food prices rose +1.4%, and a modest decline in Housing/Utilities to +1.6% from +1.8%.
  • The largest decline in prices was seen in Transport that slipped to -4.0% (from -1.2%).
  • The Bank of Korea has an inflation target of +2.0%.
  • The key piece in this data will be the modest decline in Housing/Utilities; an area of focus given house price inflation in Seoul.
  • The BOK does not meet again until November 28, having cut rates at the most recent meeting.
  • Today’s CPI potentially turns the next meeting into a live one.
  • The market currently has c. 12bps of cuts priced in over the next three months.
  • Following the conclusion of the US Election, it will be interesting to see if the market starts to forecast and price in a further cut at the next meeting.