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S Korea central bank sees 2021 consumer inflation exceeding Aug projection

S Korea central bank sees 2021 consumer inflation exceeding Aug projection

FILE PHOTO: Customers shop amid the coronavirus disease (COVID-19) pandemic at a giant mall in Seoul, South Korea, September 22, 2020. REUTERS/Kim Hong-Ji

SEOUL : South Korea's central bank said on Tuesday it expects annual consumer price growth for 2021 to hover above its August projection of 2.1per cent, with rising oil prices and a recovery in domestic demand seen adding to inflationary pressures for the time being.

"Consumer price growth will gradually ease as the base effect from (the government's) subsidies on mobile phone bills (last year) fades and the oil tax cut takes effect, though it will likely exceed 2per cent for the time being," the Bank of Korea said in a statement.

The BOK added that it is wary of the possibilities that the rise in raw material prices and global supply bottleneck may persist for some time, increasing inflationary pressures.

(Reporting by Joori Roh; Editing by Kim Coghill)

Source: Reuters

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