South Korean producer prices are up 6.9% year-on-year. The Bank of Korea's next move is no longer obvious.

South Korea's producer price index has hit its highest level since October 2022, with April's 6.9% year-on-year reading driven by a 73.9% surge in coal and petroleum product prices as the Hormuz crisis fed through to Asian energy costs. The month-on-month jump of 2.5% in April was the steepest since April 2022. The breadth matters as much as the headline: manufacturing PPI is up 11.3%, chemicals 15.6%, basic metals 11.8%, and electronics 17.4%, as Bank of Korea data via TradingView confirms. Consumer prices followed at 3.1% in May. ING had already flagged rising Bank of Korea rate hike probabilities in H2 2026, and the PPI trajectory makes that call look well-timed. For UK investors with exposure to Korean electronics, petrochemicals, or steelmakers, margin pressure is real and worsening; the question is how much pricing power individual sectors retain given global demand dynamics.