SEOUL, Dec. 18 (Xinhua) -- South Korea's headline inflation was expected to rise gradually for years to come due to the low demand-side inflationary pressure and the welfare policy effect, the central bank said Wednesday.
Consumer price was forecast to rise 0.4 percent this year, before advancing 1.0 percent in 2020 and 1.3 percent in 2021 each, the Bank of Korea (BOK) said in a report.
The consumer price inflation was 0.4 percent during the January-November period compared with the same period of last year, staying far below the BOK's inflation target of 2 percent.
It was attributed to the weakening of demand-side inflation pressure, while the government's welfare policy lowered inflationary pressure, the BOK noted.
The effect of those factors would be weakened next year, but it would take time for the headline inflation to reach the BOK's target rate, the central bank forecast.
Core consumer price, which excludes volatile food and energy cost, was predicted to gain 0.7 percent both this and next year, before climbing 1.1 percent in 2021.
Amid the low inflationary pressure, the BOK lowered its benchmark interest rate from 1.75 percent to 1.50 percent in July, before cutting it further to a record low of 1.25 percent in October.
