Korea's consumer sentiment remains flat in April despite chip rebound

Economy

Published: 24 Apr. 2024, 09:43 Updated: 24 Apr. 2024, 10:04

Korea's consumer sentiment remains flat in April despite chip rebound

A customer picks an apple in a supermarket in Seoul on March 10. A recent increase in agricultural product prices was cited as one of the factors weighing down on consumer sentiment in April. [YONHAP]

Korea's consumer sentiment stagnated in April despite continued growth in exports, as strong inflation and the high base rate continued to weigh down on the household economy.

The composite consumer sentiment index stood at 100.7 this month, unchanged from the previous month, according to a survey conducted by the Bank of Korea (BOK) released Wednesday.

A reading above 100 means optimists outnumber pessimists.

The central bank said consumer sentiment remained flat despite the rebounding semiconductor exports due to a recent rise in prices of agricultural goods and high interest rates.

Inflation expectations fell this month.

This month, ordinary people expect consumer prices to rise 3.1 percent for the year ahead, compared with the previous month's 3.2 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.

Korea's inflation stayed over 3 percent for the second consecutive month last month on record prices of fruit and rising global oil prices.

Consumer prices, a key gauge of inflation, rose 3.1 percent on year last month, following a 3.2 percent increase the previous month.

The country's central bank froze its key rate for the 10th straight session at 3.5 percent early this month amid slower-than-expected inflation moderation.

The rate freezes came after the BOK delivered seven consecutive rate hikes from April 2022 to January 2023.

BY SHIN HA-NEE, YONHAP [shin.hanee@joongang.co.kr]