By Bae Keun-min
Staff Reporter

Consumer sentiment in July worsened for the third consecutive month to hit the lowest level in 43 months, reflecting the general pessimism regarding the possibility of an economic recovery in the latter half of the year as crude oil prices continue to fluctuate.

The National Statistical Office (NSO) said Thursday that the consumer expectation index, which forecasts consumer confidence for the coming six months, declined 2.6 points from June to 89.6 last month.

The expectation index fell for the third month in a row to its lowest since December 2000, when it was at 82.2.

An index reading above 100 indicates optimists on the economic outlook outnumber pessimists among the 2,000 households polled.

The present situation index, which compares current consumer sentiment to that six months ago, plunged 5.5 points to 93.2 in July. It also dropped for three straight months to a 9-month low, the NSO said.

Among the sub-indices of the expectation index, the index for living conditions stood at 93.2, the lowest in 43 months, while that for business conditions dropped 5.5 points to 80.6 month-on-month, its lowest in 16 months.

The index for the outlook on consumption expenditure dipped to a 11-month low of 98.5, while that for spending on dining out, entertainment and cultural activities fell to 84.1, a 10-month low.

By income, the expectation index for households with a monthly income of more than four million won decreased to 95.8, this year’s lowest, while the indices for other income groups all pointed downward.

By age bracket, expectation indices for people in their 20s, which stayed above the 100-mark until May, sank for two consecutive months to 95.3. Other age groups also dipped to the year’s lowest in July.

Among the sub-indices of the present situation index, the index for business conditions dropped from 56.4 in June to 54.7 in July, while that for living conditions declined from 78.2 to 77.7.

Since exports, which have kept the economy alive despite low domestic demand, are expected to slow down with rising oil prices, consumers appear to be determined to keep their wallets firmly shut in the latter half.

kenbae@koreatimes.co.kr