SEOUL: South Korea’s consumer sentiment rose to a fresh four-year high in July, driven by optimism over the government’s supplementary budget and other measures to prop up the economy, and robust exports, the central bank says.
The composite consumer sentiment index stood at 110.8 this month, up 2.1 points from June, according to a survey conducted by the Bank of Korea (BoK).
It marked the highest level since June 2021, when the index reached 111.1, and the fourth consecutive monthly increase. The index hit 108.7 last month, marking a four-year high.
Consumer sentiment had plunged to below 90 in December following former President Yoon Suk Yeol’s imposition of martial law and remained in the 90-point range before climbing above 100 in May.
A reading above 100 indicates that optimists outnumber pessimists, while a figure below 100 means the opposite.
The improvement in consumer sentiment was attributed to the Lee Jae Myung government’s measures aimed at revitalising growth momentum and boosting private consumption.
Earlier this month, the National Assembly and the Cabinet approved a 31.8 trillion-won or about US$23bil supplementary budget amid sagging domestic demand and external headwinds.
“Despite uncertainties related to tariff negotiations with the United States, the index rose slightly thanks to improved consumer spending and solid exports,” a B0K official said on Wednesday.
Exports rose 4.3% from a year earlier in June to US$59.8bil driven by strong global demand for semiconductors, marking a turnaround from a year-on-year drop the previous month.
The sub index measuring consumer expectations for housing prices dropped 11 points to 109 in July, as the government tightened lending regulations and the pace of home price growth slowed following a recent sharp increase.
The July reading marked the sharpest decline since July 2022, when the figure fell by 16 points. — The Korea Herald/ANN
