South Korea’s consumer sentiment improved significantly in October driven by rising optimism over the economic outlook and relaxed social distancing rules, central bank data showed Wednesday.

The composite consumer sentiment index gained 12.2 points to 91.6 on-month, marking the greatest single month increase the gauge has seen in some 12 years, the Bank of Korea said. The index gained 20.2 points on-month to 93 in April 2009, when the country was reeling from the 2008 financial crisis.

A reading below 100 means pessimists outnumber optimists.

The gauge dropped to 70.8 in April, then started to steadily climb uphill to 88.2 in August, but a coronavirus flare-up here in mid-August led to a steep drop to 79.4 in September.

“The October index reflects the slowdown in the spread of COVID-19 coupled with the latest relaxed social distancing measures that led to improved sentiment towards the economy and household conditions,” said Hwang Hee-jin, head of the bank‘s economic survey team.

Meanwhile, the sub-index measuring the outlook for housing prices gained 5 points on-month to 122, with the BOK saying that nationwide apartment prices have been extending their rise.

According to recent data provided by KB Kookmin Bank, the average price of housing in the capital came to 32.73 million won ($28,500) per 3.3 square meters as of Oct. 9, up 5.18 million won from 27.55 million won on Sept. 27, 2019. The climbing prices come amid the Moon Jae-in administration’s efforts to cool down the heated housing market through a series of measures focused on tightening regulations on multiple homeowners.

South Korea‘s real gross domestic product for the July-September period climbed 1.9 percent on-quarter, marking the first quarterly expansion since the COVID-19 outbreak early this year, separate BOK data released Tuesday showed. But monetary authorities maintained their wait-and-see approach, while the government expressed some optimism over the latest turnaround.

In August, the BOK revised its outlook to predict that the economy would contract 1.3 percent on-year in 2020, on the premise that the nation would gain at least 1.5 percent growth for the third and fourth quarters.

South Korea lowered its social distancing measures by one notch to Level 1, the lowest in its three-tier system, in mid-October, after adopting tougher rules across the nation for about two months beginning in late August.

The country added 103 more COVID-19 cases, including 96 domestic infections, as of Wednesday noon, raising the total caseload to 26,146, according to the Korea Disease Control and Prevention Agency.

By Jung Min-kyung (mkjung@heraldcorp.com)