Hike in food and oil prices globally has resulted in raising the previously forecasted inflation of 3.5% to 3.9% in South Korea for the current year.

In March, South Korea reported a 29 month high in inflation rate with prices rising 4.7% from the same month a year ago.

South Korea is trying hard to keep the rise in prices under check as it is Asia’s fourth-biggest economy. To offset the rising oil prices, last week country has decided to cut the tax on fuel.

Economist said that inflation forecast has been raised as a last option after monitoring all the necessary steps to fight against the rise in prices by the central bank. They also said that the central bank has maintained its growth projection for the economy at 4.5% for this year despite of raise in inflation forecast.

There would be a rise in consumer’s price index than previously expected, revealed by the Bank of Korea on Wednesday. Relying on this forecast the bank has raised its policy rate further to ensure sustainable growth in Asia's fourth-largest economy.