S. Korea May PPI remains flat, below market expectations

South Korea’s Producer Price Index, in annual terms, for the month of May remained nearly flat, albeit below market expectations compared to that in April. While, manufacturing sector added to the producer price basket, prices of agri and marine products fell largely, offsetting the rise.

The producer price index for May fell 3.1 percent from a year ago, compared with a 3.0 percent fall in April and an upwardly revised 3.1 percent fall. However, market participants had anticipated an increase of 0.3 percent, down from 0.2 percent in April, data released by the Bank of Korea showed Monday.

Among the individual components, prices for agricultural, forestry & marine products fell 4.2 percent on month, while manufacturing products added 0.5 percent, electric power, gas & water supply slid 1.9 percent and services gained 0.1 percent. The same index in monthly terms showed no change in May, slowing from a revised 0.3 percent gain in the previous month, the BoK said.

Meanwhile, industrial goods, which include petrochemicals, textiles and electronics, have a 54.66 percent weightage in the overall index, compared with 35.64 percent for service fees and 3.42 percent for farm and fisheries products. Electricity, tap water and gas have a 6.03 percent weighting, reports confirmed.