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/ Source: Yonhap News

South Korea’s consumer sentiment index reached its highest level in eight years in November, boosted by the conclusion of U.S.–Korea tariff negotiations and stronger-than-expected third-quarter GDP growth.

According to the Bank of Korea’s Consumer Survey released on November 25, the Composite Consumer Sentiment Index (CCSI) rose to 112.4 this month, up 2.6 points from October. The index had fallen for two consecutive months in September and October before rebounding in November. This marks the highest reading since November 2017, when the figure stood at 113.9.

The CCSI reflects consumers’ overall perception of economic conditions, based on six components: current living conditions, expected household income, expected spending, future living conditions, current economic assessment and future economic outlook. A reading above 100 indicates optimism; below 100 signals pessimism.

Lee Hye-young of the Bank of Korea’s Economic Statistics Department said the sharp rise was partly due to a base effect following last year’s downturn triggered by the emergency martial law declaration and concerns over worsening trade conditions. She added that the recent U.S.–Korea tariff agreement and stronger GDP performance also helped lift sentiment.

Among the six sub-indices, the outlook for future economic conditions posted the biggest increase, rising eight points from the previous month to 102. The assessment of current economic conditions climbed five points to 96. Expectations for household income and future living conditions rose two and one points, respectively, to 104 and 101.

The housing price outlook index fell three points to 119, with analysts citing strong government property regulations—such as the October 15 measures—as dampening expectations for further price gains. Still, the index remains elevated compared with July’s reading of 109 following the June 27 real estate measures.

The interest rate outlook index, which forecasts the expected level of interest rates six months ahead, increased three points to 98. Expected inflation held steady at 2.6 percent.