Consumer sentiment falls to 95.9Korea’s consumer sentiment reached its lowest level in eight months in July, central bank data showed Friday, amid growing concerns that Asia’s fourth-largest economy could lose momentum due to protracted trade tensions.
The composite consumer sentiment index came to 95.9 this month, down 1.6 percentage points from a month earlier, according to the data from the Bank of Korea (BOK).
The reading marks the lowest since November, when the index stood at 95.7. A reading below the benchmark 100 means pessimists outnumber optimists
The drop apparently follows Japan’s export restrictions on three materials used to produce semiconductors and display panels, both key export items from Korea, in apparent retaliation against Seoul over recent court decisions ordering Japanese companies to pay compensation to Korean workers forced into labor during World War II.
Korea’s exports have been on a steady decline since December. Many believe Japan’s export curbs will further undermine Korean exports and also disrupt global supply chains for the two IT products.
Last week, the central bank slashed its growth outlook to 2.2 percent from a 2.5-percent forecast three months earlier, citing a number of economic headwinds facing Korea, including U.S.-China trade friction and Japan’s export curbs.
In the monthly survey, those surveyed saw no immediate changes to their living conditions as the index measuring their sentiment toward their own economic conditions remained flat from the previous month at 91, with the index measuring their future conditions also staying unchanged at 92.
However, the index measuring the respondents’ outlook on conditions facing Asia’s fourth-largest economy dropped to 67 in July from 69 the month before. The index for their outlook on economic conditions six months dropped to 70 from 75 over the cited period.
The latest survey was conducted from July 10 to 17, involving some 2,400 households throughout the nation.