South Korea's consumer prices rose at the fastest pace in almost 24 years in July due to high energy and food prices, data showed Tuesday, raising expectations that the central bank will continue to raise the policy rate to tame inflation.

Consumer prices soared 6.3 percent last month from a year earlier, accelerating from a 6 percent on-year spike in June, according to the data from Statistics Korea.

It marked the sharpest on-year increase since November 1998, when consumer inflation jumped 6.8 percent. The inflation rate stayed in the 6 percent range for the second straight month.

Consumer prices rose above 2 percent -- the central bank's inflation target over the medium term -- for the 16th straight month in July.

The statistics agency said prices of petroleum products and personal services continued their fast growth in July.

"Prices of farm products and those of electricity, gas and water supplies also picked up," Eo Woon-sun, a senior Statistics Korea official, told reporters.

He said the growth of consumer prices may slow in August and September, given the base effect, but forecast annual inflation is likely to surpass 5 percent.

Inflationary pressure has built up as crude oil and other commodity prices rose due to the protracted war between Russia and Ukraine, and global supply disruptions. A recovery in demand from the pandemic also exerted upward pressure on prices.

Last month, prices of petroleum products jumped 35.1 percent on-year due to high fuel costs. But the July reading slowed from a 39.6 percent rise in June. South Korea depends mainly on imports for its energy needs.

A recovery in demand and the lifting of major virus curbs also pushed up prices of personal services, which rose 6 percent, the fastest in over 24 years. The costs of dining out soared 8.4 percent.

Prices of agricultural, livestock and fisheries goods rose 7.1 percent on-year, picking up from a 4.8 percent rise the previous month. Vegetable prices jumped 25.9 percent amid frequent rains and heat waves.

Core inflation, which excludes volatile food and oil prices, climbed 3.9 percent on-year last month.

In July, prices of daily necessities -- 141 items closely related to people's daily lives, such as food, clothing and housing -- jumped 7.9 percent on-year.

Rising inflationary pressure is building the case for the Bank of Korea (BOK) to maintain its monetary tightening stance in the coming months.

Last month, the BOK delivered an unprecedented 0.5 percentage-point rate hike to 2.25 percent in a bid to curb inflation. It marked the sixth rate increase since August last year.

South Korea has faced the risk of stagflation, a mix of slowing growth and high inflation, due to heightened external economic uncertainty.

Rising inflation erodes people's purchasing power and could weigh on private spending. A rate hike is meant to curb inflation, but it could increase debt-servicing burdens and slow down economic growth.

Finance Minister Choo Kyung-ho earlier said Inflation is likely to peak no later than in October if there is no sharp hike in global oil and grain prices.

In June, the finance ministry sharply raised its 2022 inflation outlook to a 14-year high of 4.7 percent while lowering its economic growth estimate to 2.6 percent.

The BOK put its 2022 growth forecast at 2.7 percent and expected consumer prices to rise 4.5 percent this year.

Global credit appraiser S&P Global Ratings forecast South Korea's inflation to jump 5 percent in 2022. (Yonhap)