Consumer Sentiment Falls for First Time in Six Months: "Construction Slump, U.S. Tariff Concerns"

The Consumer Composite Sentiment Index (CCSI) for September turned downward for the first time in six months. The upward trend was halted due to concerns over a sluggish construction sector and the potential slowdown in exports resulting from U.S. tariffs. Meanwhile, expectations for housing prices, which had seemed to stabilize somewhat after the June 27 policy measures, rose for the second consecutive month as apartment prices continued to climb in some areas of the Seoul metropolitan region.

Yonhap News Agency

원본보기 아이콘

According to the "September 2025 Consumer Survey Results" released by the Bank of Korea on the 24th, this month's CCSI stood at 110.1, a decrease of 1.3 points from the previous month. The CCSI is a comprehensive index reflecting consumers' sentiment regarding economic conditions. It is calculated using six major indices that make up the Consumer Survey Index (CSI). With the long-term average set at 100, a value above 100 indicates optimism, while a value below 100 indicates pessimism.

This is the first time the CCSI has turned downward since April of this year. Until November of last year, the CCSI remained above 100, but it plummeted to 88.2 in December due to the 12·3 Martial Law incident, which dampened consumer sentiment. After dropping by 1.8 points in March this year (to 93.4), the index had risen for five consecutive months starting in April. Lee Hyeyoung, head of the Economic Sentiment Survey Team at the Economic Statistics Department 1, explained, "The slight decline was due to ongoing weakness in the construction sector and growing concerns over export slowdown resulting from expanded U.S. tariffs." However, she added, "Since the index still remains well above the long-term average, the situation should be viewed as optimistic compared to the long-term trend."

By sector, both the Current Economic Assessment CSI and the Future Economic Outlook CSI declined. The Current Economic Assessment CSI, which compares current conditions to those six months ago, was recorded at 91, down 2 points from the previous month. While this is lower than the baseline of 100, it is higher than the long-term average (2008-2024) of 72. Lee commented, "This is due to the continued weakness in the construction sector and a decline in exports to the United States." The Current Living Conditions CSI remained unchanged from the previous month at 96.

원본보기 아이콘

The Future Economic Outlook CSI, which forecasts economic conditions six months ahead, dropped by 3 points from the previous month to 97. This index has declined for three consecutive months due to concerns over export slowdown caused by U.S. tariffs. As sentiment weakened, both the Living Conditions Outlook CSI (100) and the Consumer Spending Outlook CSI (110) also fell by 1 point compared to the previous month.

The Housing Price Outlook CSI rose by 1 point from the previous month to 112. After dropping sharply by 11 points following the June 27 household debt management measures, this index rebounded last month and has now increased for two consecutive months. The Bank of Korea analyzed that this was due to continued sharp increases in certain areas of the Seoul metropolitan region.

Although the index is rising again, authorities believe it is too early to conclude that the effects of household loan regulations have dissipated. Lee stated, "Since the index remains above the long-term average (107), there are still expectations for further increases." She added, "However, it is still lower than the level before the June 27 measures (120), the increase is not large, and the pace of growth has slowed compared to last month, so we need to continue monitoring future trends."

The expected inflation rate for the next year (2.5%) fell by 0.1 percentage points from the previous month, as the consumer price inflation rate slowed despite rising prices for agricultural, livestock, and fisheries products, due to declining international oil prices and discounts by some telecommunications companies. The expected inflation rates for three years and five years ahead both remained at 2.5%, unchanged from the previous month. The top items expected to influence consumer price inflation over the next year were agricultural, livestock, and fisheries products (58.1%), public utility rates (43.4%), and industrial products (30.3%). Compared to the previous month, the proportion of responses citing agricultural, livestock, and fisheries products (up 2 percentage points) and public utility rates (up 3.1 percentage points) increased, while the share for petroleum products (down 4.5 percentage points) decreased.

This survey was conducted from September 9 to 16, targeting 2,500 households in urban areas nationwide, with 2,277 households responding.

© The Asia Business Daily(www.asiae.co.kr). All rights reserved.