Producer prices in August dropped for the first time in nearly two years thanks to falling oil prices.

The Bank of Korea on Friday reported that the producer price index for all commodities and services stood at 120-point-12 last month, down zero-point-three percent from a month earlier.

The index, a key barometer of future inflation, dropped for the first time in 22 months since October 2020 when it fell zero-point-four percent.

Compared to a year earlier, however, the index remained high with an increase of eight-point-four percent, the 21st consecutive month of growth.

The prices of industrial products dropped one-point-four percent on-month in August due to the fall in oil prices, with the prices of coal and petroleum products slipping eight-point-six percent.

The prices of agricultural and fishery products, however, rose by two-point-five percent on-month in August, while the prices of electricity, gas and water gained three-point-six percent.