South Korea’s consumer confidence slipped in September for the first time in half a year, as concerns over U.S. tariffs and a sluggish construction sector weighed on households.
The Bank of Korea said Tuesday its composite consumer sentiment index (CCSI) fell to 110.1 in September, down from 111.4 in August, ending a five-month streak of gains. The index had plunged 12.5 points last December during a state of emergency before staging a gradual recovery. A reading above 100 indicates optimism compared with the long-term average from 2003 to 2024, while a figure below 100 signals pessimism.
Among the six components, expectations for the economic outlook saw the largest drop, falling 3 points to 97. Current economic conditions slipped 2 points to 91, while the outlooks for household living conditions and spending each declined by 1 point. Household income expectations and current living conditions were unchanged.
“Uncertainty around U.S. tariff negotiations and persistent weakness in construction weighed on consumer sentiment this month,” said Lee Hye-young, who leads the BOK’s economic sentiment survey team.
Despite weaker overall sentiment, households grew more optimistic about housing. The housing price outlook index rose to 112, up 1 point from August and extending gains for a second month. That follows an 11-point drop in July after the government announced new debt-control measures. Still, Lee noted the index remains well below June’s level of 120, adding that “it’s too early to say whether recent gains signal a sustained rebound, given the impact of regulatory measures.”
Consumer inflation expectations for the next 12 months edged down to 2.5%, compared with 2.6% in August. The outlook for interest rates six months from now also fell, with the index slipping 2 points to 93.
