Consumer sentiment bucks optimistic trend in March

Fruit is displayed at a marketplace in Seoul on Jan. 21. [YONHAP]

Korea's consumer sentiment snapped a three-month streak of improvement 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 (BOK).

A reading above 100 means optimists outnumber pessimists.

The central bank attributed the decline to a rise in the prices of agricultural goods and sluggish domestic demand.

Inflation expectations rose this month after a two-month downward trend.

This month, ordinary people expect consumer prices to rise 3.2 percent for the year ahead, compared with the previous month's 3 percent.

The figures are closely watched as upward movement 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 price growth posted an on-month acceleration.

The country's central bank froze its key rate at 3.5 percent last month for the ninth straight session 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