Korea: Consumer confidence tumbles on MERS outbreak
June 25, 2015
The Composite Consumer Sentiment Index (CCSI) published by the Bank of Korea (BoK) dropped from 105 points in May to 99 points in June, which marked the largest monthly loss in over four years. June’s result is the lowest since December 2012 and puts the historically-volatile index a notch below the 100-point threshold that separates optimism from pessimism.
According to the BoK, June’s reading was driven by a significant deterioration in consumers’ views regarding current and prospective domestic economic conditions. The outbreak of the Middle East Respiratory Syndrome (MERS) is hurting consumer sentiment substantially as it threatens to push an already-weak economy into an even steeper downward cycle. Consumers were also less confident about living standards and household income in June compared to the previous month.
Author: Carl Kelly, Economist