S. Korea`s import price growth picks up on weaker won

(ATTN: CLARIFIES para 2)
SEOUL, Nov. 14 (Yonhap) -- The growth of South Korea's import prices accelerated in October from a month earlier as a weaker local currency outweighed retreats in oil prices, the central bank said Friday.

Import prices in local currency terms jumped 47.1 percent on-year in October,
compared with a 42.6 percent annual gain the previous month, according to the
Bank of Korea (BOK). The country's import prices climbed 50.6 percent on-year in
July, hitting a 10-year high.
Meanwhile, import prices advanced 4.1 percent on-month in October, accelerating
from a 2.3 percent gain in September, it added.
"Raw material costs declined due to falling oil prices, but growth in import
prices accelerated in October on a softer won," said Lee Byung-doo, an official
at the BOK. "If the won does not sharply weaken against the U.S. dollar, then
growth in import prices is expected to slow down the road."
Raw material prices rose 47.3 percent on-year in October, slowing from a 59.1
percent gain the previous month, it added.
Oil prices have been on a downward path after peaking at $147 per barrel in July.
South Korea, the world's fifth-largest crude buyer, relies entirely on imports
for its oil needs.
A weaker won against the dollar is putting upward pressure on inflation as it
makes imports more expensive. South Korea's currency has declined almost 33
percent against the greenback so far this year.
Last week, the BOK slashed its key interest rate for the third time in a month to
bolster the slowing economy. In a monthly policy meeting, the BOK lowered the
benchmark seven-day repo rate by a quarter percentage point to 4 percent, the
lowest level since 2006, cutting a combined 1.25 percentage point in the span of
a month.
sooyeon@yna.co.kr
(END)