Historic CPI inflation South Korea (yearly basis)
Since its independence in 1945, the general trend of inflation rate has been decreasing, and consumer price index has been increasing. The reason why the inflation rate was so high in the beginning (more than 100%) is that the nation had nothing left after the brutal Japanese occupation. While Korean government had nothing to support the value of money, Korean government still printed money. The result was the inflation caused by higher supply of money than the demand. Since then, the value of money contantly decreased: due to sudden increase in the quantity and quality of the production, increase in wage, and forein impact (increase in oil price). Fast growth caused the inflation.
However, people in those days did not feel the inflation due to the controlled price by the government. President Park Jung Hee was a tyranny, although he worked for the nation and promoted the economic growth; the governemnt strictly controlled the price of necessities.
Recently, the inflation rate is usually between 1% and 4%. The inflation rate seems to have no influence from 1998 currency crisis and 2009 global crisis.
On the other hand, the consumer price index graph has steep slope in 1998 and 2009, which is relevant to GDP.
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