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Consumer sentiment snaps 3-month rise in March amid rising prices, slumping spending

March 26, 2024 - 09:12 By Yonhap
Apples are displayed at a marketplace in Seoul on Sunday. (Yonhap)

South Korea's consumer sentiment snapped an improvement for the third consecutive month in March amid soaring prices of farm goods and a slump in private spending, a central bank poll showed Tuesday.

The composite consumer sentiment index stood at 100.7 this month, down from 101.9 the previous month, according to the survey conducted by the Bank of Korea.

A reading above 100 means optimists outnumber pessimists.

The central bank said consumer sentiment declined amid a rise in prices of agricultural goods and sluggish domestic demand.

Inflation expectations rose this month, snapping a two-month decline.

This month, ordinary people expect consumer prices to rise 3.2 percent for the year ahead, compared with the previous month's 3.0 percent.

The figures are closely watched, as their upward move could cause businesses to raise prices and people to ask for pay raises, thereby resulting in more upward pressure on inflation going forward.

Last month, consumer prices, a key gauge of inflation, rose 3.1 percent on-year, compared with a 2.8 percent increase a month earlier, marking the first time in four months that the price growth accelerated in an on-month term.

The country's central bank froze its key rate for the ninth straight session at 3.5 percent last month amid slower-than-expected inflation moderation and high household debt.

The rate freezes came after the Bank of Korea delivered seven consecutive rate hikes from April 2022 to January 2023. (Yonhap)