March 2, 2020 / 11:09 PM / a month ago

South Korea February inflation slows as virus hits demand

FILE PHOTO: A street vendor counts his money at the Namdaemun Market in Seoul, South Korea, May 30, 2017. REUTERS/Kim Hong-Ji/File Photo

SEOUL (Reuters) - South Korea’s consumer inflation eased in February on cooling demand due to the coronavirus outbreak and falling oil prices, official data showed on Tuesday, underpinning the need for further rate cuts to boost consumption and growth.

The consumer price index (CPI) rose 1.1% in February from a year earlier, Statistics Korea said, down from a 1.5% increase in January but a notch above the median 1.0% rise seen in a Reuters poll.

Compared with a month earlier, the index was unchanged in February after edging up 0.6% in January.

The central bank maintained this year’s inflation forecast at 1.0%, much below the bank’s 2.0% target, when it decided to keep its policy rate unchanged last week, though acknowledging risks from the virus.

Reporting by Joori Roh; Editing by Chris Reese

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