Korea: Consumer confidence picks up in May, ending five-month downturn
May 29, 2018
The Bank of Korea’s composite consumer sentiment index rose in May, ending the longest downturn since the survey began in July 2008. The index increased to 107.9 in May from 107.1 points in April, remaining above the 100-point threshold that separates optimism from pessimism among Korean households.
The uptick in May was largely driven by improved sentiment regarding current and future domestic economic conditions. Households were more upbeat about future spending, whereas they were more downbeat about future income, which was likely caused by concern over the financial consequences of fewer working hours being available starting in July, when a law limiting the maximum hours worked in a week comes into effect. Meanwhile, consumers’ outlook on current and future living standards was unchanged.
Korea Private Consumption Forecast
FocusEconomics Consensus Forecast panelists expect private consumption to expand 2.7% in 2018, which is unchanged from last month’s forecast. For 2019, the panel sees private consumption growth at 2.5%.