South Korea’s consumer inflation weakened to an 11-month low in June as supply-side pressures eased, official data showed on Tuesday, coming in below market expectations and providing some relief for policymakers.

The consumer price index (CPI) rose 2.4% higher in June from a year earlier, slower than the 2.7% rise in May and the weakest since July 2023, according to Statistics Korea.

It was also well below the median 2.7% rise tipped in a Reuters survey of economists.

Consumer inflation is expected to stabilise to the lower-to-mid 2% level in the second half, the country’s vice finance minister said, vowing continued policy measures to keep prices under control.

The Bank of Korea (BOK) said in its assessment it sees the fact that inflation has come down to the mid-2% level as a positive and that it will watch to see if inflation converges with its 2% target.

The index fell 0.2% on a monthly basis, after a 0.1% rise in the previous month, marking the first decline in seven months.

By product, prices of agricultural goods fell 5.3% over the month while petroleum goods lost 2.9%, dragging the index lower.

BOK governor Rhee Chang-yong said last month the pace of consumer inflation is likely to continue to slow, feeding expectations the central bank will start cutting interest rates towards the end of this year.

The BOK extended its interest rate pause for an 11th straight meeting in May. The bank next meets on July 11.

The core CPI, excluding volatile food and energy items, was 2.2% higher in June than a year before, in line with May.