South Korea consumer confidence jumps to 8-year high on robust growth

[SEOUL] South Korea’s consumer confidence climbed to an eight-year high in November, supported by a trade agreement with the US that eased uncertainty over export prospects and by stronger-than-expected growth over the summer.

The increase follows two straight months of declines. South Korea’s exports have largely held firm this year, supported by strong semiconductor shipments driven by demand for artificial intelligence and data centres, even as higher US tariffs weighed on sentiment.

In late October, Seoul and Washington finalised details of the US$350 billion investment package central to the agreement, capping US tariffs on Korean goods at 15 per cent. The two sides formally signed a memorandum of understanding earlier this month, further easing trade uncertainties.

The central bank will hold its rate-setting meeting on Thursday (Nov 27), where it’s expected to weigh financial-stability risks from a persistent rally in Seoul apartment prices as it decides whether to extend a pause in its easing cycle. Policymakers will also take into account stronger-than-expected third-quarter growth, which may discourage them from adding further monetary stimulus.

South Korea’s GDP grew 1.2 per cent in the three months to September from the previous quarter, beating the median estimate of 1 per cent growth. The Bank of Korea (BOK) is set to release its revised economic and inflation forecasts for this year and next when it meets on Nov 27.

A sub-index tracking housing price expectations fell for the first time since July, dropping three points to 119 as apartment price gains slowed following the government’s rollout of new curbs in October, the BOK said. The outlook for household debt also declined by one point to 98, marking its first drop since May. BLOOMBERG