Producer Prices Stable in November... Financial and Insurance Services Up 0.9% Amid Stock Price Rise

Bank of Korea 'November Producer Price Index'

[Image source=Yonhap News]

[Asia Economy Reporter Eunbyeol Kim] The producer price index (PPI) for November remained flat compared to the previous month. While prices of manufactured goods rose, the decline in prices of agricultural, forestry, and fishery products had an offsetting effect.

According to the Bank of Korea on the 22nd, last month's producer price index stood at 103.06 (2015=100), showing little change from October's 103.01. Producer prices had increased from June to September due to typhoons and monsoon rains, but prices of agricultural and fishery products stabilized somewhat, leading to a decline in October for the first time in five months.

Kang Hwan-gu, head of the Bank of Korea's price statistics team, explained, "Although prices of livestock and fishery products rose, agricultural product prices fell, causing the overall agricultural, forestry, and fishery product prices to decrease by 1.6% compared to the previous month. Meanwhile, manufactured goods prices increased by 0.2% month-on-month, driven by rises in chemical products (0.8%) and coal and petroleum products (0.6%)."

Service prices within the producer price index remained stable. Financial and insurance services rose by 0.9%, but restaurant and accommodation services declined by 0.2%.

Kang said, "The rise in stock prices contributed to the increase in financial and insurance service prices, while restaurant and accommodation services fell, mainly due to a 7.0% drop in resort condos. This indicates that the impact of COVID-19 continues to affect service prices." He added, "Since stock prices are continuing to rise in December, financial and insurance service prices are expected to show a slight upward trend." Among financial and insurance service prices, brokerage commission fees rose 4.9% month-on-month.

Compared to a year ago, the November producer price index decreased by 0.3%. In particular, coal and petroleum product prices fell sharply by 30.7% due to reduced demand amid the COVID-19 pandemic. However, agricultural product prices were 12.2% higher than a year earlier.

The domestic supply price index, which includes imported goods, fell 0.2% month-on-month and dropped 3.0% year-on-year.

The total output price index for November, which adds export goods to domestic shipments, decreased by 0.2% month-on-month and 1.6% year-on-year.

This content was produced with the assistance of AI translation services.