Korea: Consumer sentiment plunges in March after Japan earthquake
March 25, 2011
In March, the Consumer Sentiment Index (CSI) published by the Bank of Korea plunged to 98 points from 105 points in February. The decline marked the fourth consecutive monthly drop in the index and pushed consumer sentiment to its lowest level since April 2009. With the March drop, consumer confidence fell below the 100-point threshold that separates optimism from pessimism, implying a dismal outlook for private consumption in the coming months. This month's survey was strongly influenced by the earthquake crisis in Japan, as respondents to the survey believed that this event will negatively affect economic conditions in Korea in the coming months. In particular, households' outlook regarding their income in the short term moderated strongly, leading to deteriorating prospects for major purchases going forward.
Author: Armando Ciccarelli, Head of Data Solutions