"Rising Prices Make Living Conditions Harder"... Consumer Sentiment Up for Third Consecutive Month

November 23 'November 2021 Consumer Sentiment Survey' Announcement
Bank of Korea "Consumer Sentiment Not Significantly Improved Despite Price Increases"

[Asia Economy Reporter Jang Se-hee] Consumer sentiment index has risen for the third consecutive month amid expectations of With Corona (gradual return to normal life). However, due to soaring prices, the outlook for living conditions fell by 1 point compared to the previous month.

According to the 'November 2021 Consumer Survey' released by the Bank of Korea on the 23rd, the Consumer Sentiment Index (CCSI) for this month was 107.6, up 0.8 points from last month (106.8). Due to the 4th wave of COVID-19, it fell by 7.8 points in July and August, but rose by 5.1 points from September to November.

The Consumer Sentiment Index is a comprehensive indicator of consumers' economic sentiment; a value above 100 indicates optimism compared to the long-term average, while below 100 indicates pessimism.

Among the six components that make up the Consumer Sentiment Index, the outlook for consumer spending rose by 3 points, leading the overall index increase. The current economic situation assessment also rose by 1 point. The outlook for current living conditions, household income, and future economic conditions remained at the same level as the previous month. On the other hand, the outlook for living conditions fell by 1 point.

Hwang Hee-jin, head of the Statistical Survey Team at the Bank of Korea's Economic Statistics Bureau, analyzed, "The easing of private gatherings due to With Corona influenced the rise in consumer spending."

However, the Bank of Korea views that the sentiment regarding living conditions has not improved due to the impact of rising prices. He added, "As price increases continue, the living conditions part did not rise significantly," and explained, "Ultimately, due to the impact of rising prices, consumer sentiment has not fully improved significantly."

The perception of consumer price inflation over the past year, known as price perception, and the expected inflation rate for the next year both rose by 0.3 percentage points to 2.7% compared to the previous month. This is the largest increase since January 2017 (0.3 percentage points).

Regarding expected inflation, it showed a slight upward trend and has maintained the 2% range for 10 consecutive months since entering the 2% range in February this year.

The Employment Opportunity Outlook CSI rose by 4 points to 98 due to expectations of economic recovery. The Interest Rate Level Outlook CSI rose by 5 points due to expectations of additional base rate hikes.

The Housing Price Outlook CSI fell by 9 points despite the continued rise in housing prices, due to rising interest rates and household loan regulations.

This content was produced with the assistance of AI translation services.