By Lee Yoonseo and Kim Young Shin
The Consumer Composite Sentiment Index (CCSI) rebounded in May after six months thanks to improved relations between South and North Korea after the Inter-Korean Summit that took place on April 27.
The CCSI is an indicator that rates the overall consumer sentiment of the economy by combining six sub-indices, including current living standard, prospective living standards, prospective household income, prospective household spending, current domestic economic conditions and prospective domestic economic conditions. When the index is higher than 100, it indicates an optimistic outlook, and lower than 100, a pessimistic one.
According to an announcement from the Bank of Korea on May 29, the CCSI in May hit 107.9, up 0.8 points from the previous month. The CCSI had been dropping for five months since December last year.
The sub-index for consumer sentiment related to current domestic economic conditions (89) and future domestic economic conditions (101) rose by 3 points and 5 points, respectively. This means there are more people who feel that the economy is improving and more consumers that expect the economy to improve in the future.
“The CCSI rose in May because consumers expect more economic cooperation after the improvement in relationship between the two Koreas and the easing of tensions between the U.S. and China regarding trade,” said an official from the Bank of Korea.