By Lee Hyo-sik
Staff Reporter
The rise in consumer sentiment index in September does not mean a major U-turn of the current sluggish economy as skyrocketing oil prices and heavy household debts depress consumption.




According to the National Statistical Office (NSO) Tuesday, the consumer expectation index, which predicts consumer confidence for the coming six months, rose for the first time in five months to 88.9 in September from 87 in August as stock markets rallied and prices of agricultural and fisheries products stabilized last month.
The August figure was at the similar level of 86.7 in December 1998.

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

Among the sub-indexes of the expectation index, the index for living conditions increased marginally to 93.3 in September from 92.3 a month ago and that of consumption expenditure to 98 from 95.1.

The index for the outlook on durable goods purchases rose to 86.5 in September from 84.8 a month ago, while that of dining-out and entertainment came to 84.7, up from 81.7 in August when it marked the lowest figure since March 1999.

Meanwhile, an index measuring the current consumer sentiment on the economy and living conditions compared to that of six months ago, also improved to 65 in September from 63.1 a month ago, but still lower than 65.9 recorded in November 1998 when South Korea was grappling with the Asian financial crisis.

In September, consumer prices rose by 3.9 percent from a year ago and wholesale prices by 7.5 percent.

Among the sub-indexes of the present situation, the index for business conditions came to 53.6 last month, 14.6 points lower than 68.2 recorded in November 1998. The index for living conditions was at 76.3, similar to the level of 1997 and 1998.

``Despite a pick up in consumer sentiment last month, it is still too early to say whether consumer confidence will substantially rebound in the near future from record-lows in the previous months.’’ NSO officials said.

The officials added that various economic indexes, including consumer sentiment, are expected to indicate the domestic economy stay stagnant for a foreseeable future due mainly to surging crude oil prices.

leehs@koreatimes.co.kr