SEOUL: South Korea’s inflation rate in April remained at its lowest level since 1999, fanning concerns that Asia’s fourth-largest economy is slipping towards a period of deflation, government data showed Friday.The consumer price index was up 0.4 per cent in April from a year earlier, unchanged from the rate in March, Statistics Korea said.
Rises in rents and services were largely offset by sharp declines in energy costs as oil prices plunged 20.9 per cent from a year ago.South Korea imports almost all of its energy needs.Inflation has remained far below the Seoul central bank’s target of 2.5 to 3.5 per cent for nearly three years.
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Despite record-low interest rates, South Korea’s central bank predicted annual inflation would drop below the 1.0 per cent mark in 2015, fuelling fears of deflation that could hammer an overgrown property market.The exports that drive the country’s economy have fallen in every month this year, including April.
