SEOUL, Feb. 24 (AJP) — South Korea’s consumer confidence rose to its strongest level in three months in February, buoyed by a robust stock market and resilient exports, central bank data showed Tuesday.
According to the Bank of Korea, the composite consumer sentiment index (CCSI) stood at 112.1 in February, up from 110.8 in January and 109.8 in December.
A reading above 100 indicates that optimism outweighs pessimism compared with the long-term average.
The index measuring perceptions of current economic conditions rose 5 points to 95, while the six-month outlook climbed 4 points to 102, indicating that more consumers expect overall conditions to improve.
Employment sentiment also strengthened, with the subindex for job prospects edging up 2 points to 93.
Sentiment on prices and housing inflation stabilized. One-year inflation expectations remained unchanged at 2.6 percent, while expectations for interest rates ticked up 1 point to 105.
The current living standards index held steady at 96, while the outlook index rose 1 point to 101. The prospective household income index remained at 103, and the expected household spending index was unchanged at 111.
Overall, improved assessments of macroeconomic conditions offset stable household income expectations, keeping consumer sentiment firmly in optimistic territory above its long-term average.
The prospective interest rates index has risen steadily since November, climbing from 98 to 105 over four months, as higher bond yields and persistent global rate uncertainty led consumers to expect borrowing costs to remain elevated for longer.
Perceptions of household savings and debt showed mixed signals.
The current household savings CSI rose 1 point to 100, and the savings outlook CSI increased 1 point to 102. In contrast, the current household debt CSI remained unchanged at 99, while the debt outlook CSI edged down 1 point to 96.
Expectations for prices and asset values shifted modestly. The overall price level outlook CSI slipped 1 point to 147. The housing price outlook CSI fell sharply by 16 points to 108. The wage outlook CSI was unchanged at 123.
Inflation expectations remained broadly stable. Perceived inflation over the past year stood at 2.9 percent, unchanged from January. Expected inflation for the next year held at 2.6 percent, while three-year and five-year ahead expectations were both unchanged at 2.5 percent.
Despite a moderation in headline inflation, higher prices for processed foods and seafood helped keep inflation expectations steady.
In terms of distribution, the 2–3 percent range accounted for the largest share of responses for one-year ahead inflation expectations at 29.7 percent. The same range was also most cited for three-year ahead expectations at 29.8 percent and five-year ahead expectations at 28.2 percent.
Overall, inflation expectations remained anchored, housing price expectations cooled significantly, and household savings sentiment improved slightly, while debt outlook perceptions softened.
However, households continued to cite agricultural products and utilities as the main drivers of expected price increases over the next year.
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