The Bank of Korea indicated on Thursday that it anticipates the inflation rate for July will decelerate compared to the previous month, supported by government efforts to stabilize consumer prices and a decline in crude oil costs following eased tensions in the Middle East.

During a meeting convened to evaluate inflation trends, Deputy Governor Lee Ji-ho stated, "Consumer prices in June increased further from May, driven by persistently high petroleum product prices and an accelerated rise in agricultural product prices."

He added, "The inflation rate is expected to remain elevated in the near term, as demand-side pressures stemming from economic growth will offset the downward pressure from falling crude oil prices."

Government data released earlier in the day showed that South Korea's consumer prices in June rose by 3.2 percent year-on-year, marking the largest increase since December 2023, which saw a matching rate of increase. In May, consumer prices had increased by 3.1 percent year-on-year.

Last month, fuel prices surged by 24.7 percent, contributing 0.93 percentage points to the overall rise in consumer prices. This represents the largest increase since July 2022, when the increase was 35.2 percent.

Prices for agricultural and fishery products rose by 3.2 percent.