Inflation stands at six percent and economists expect it to rise further. Consumer prices in July are going to be affected by electricity and gas fees that were hiked earlier this month, while fruit and vegetable prices are expected to climb in August when demand increases ahead of Chuseok, Korea's biggest holiday.
The government fears inflation could reach seven to eight percent, vastly exceeding the earlier projection of 4.7-percent.
International grain prices are expected to rise further in the second half of this year due to Russia's invasion of Ukraine, the global bread basket.
Grain prices started surging in March and the effects are reflected in the second half of this year.
Meat prices have already soared 10.3 percent, while vegetable prices have increased six percent and rising prices of imported flour and wheat products are expected to exacerbate the situation, according to the Ministry of Agriculture, Food and Rural Affairs.
The average import price of wheat has risen to US$445 per ton, up 40 percent from a year ago. A senior ministry official has met with representatives of nine major milling companies and urged them to keep prices down.
An Dong-hyun at Seoul National University said, "There were hopes that consumer prices would peak in March or May, but instead they rose another six percent in June, so nobody knows what's going to happen. Rising consumer prices cause private spending to decline and lead to the polarization of wealth. The entire economy will be hit."