Public expects inflation to average at 3.9% for next 12 months: BOK's survey in June
Updated: 2022-06-29 11:10:33 KST
Consumers in South Korea are feeling the pinch from surging prices.
And amid prices increases, expectations over the country's future inflation rate, as predicted by the public, hit its highest level in a decade.
Data published by the Bank of Korea shows that consumers believe inflation will average three.nine percent over the next 12 months.
This is up point-six percentage points compared to the month before, with figures rising for a fifth month in a row.
The Bank of Korea said this is largely due to soaring food and energy prices around the world, while experts say the grim outlook may spell trouble for the economy.
A rapid surge in the future inflation rate could result in consumers buying things in advance… leading to further inflation.
Meanwhile, figures for the consumer sentiment have dropped below the one-hundred threshold for the first time in more than a year.
The central bank's Composite Consumer Sentiment Index in June stood at around 96.four, falling six.two points on-month.
A figure below one-hundred means public opinion on the economy is more pessimistic than optimistic.
Even during the period from March last year to up until May 2022 when the economy was hit hard by the pandemic, the index stayed above one-hundred.
Pundits say the South Korean economy may take another blow if the central bank opts to take a big step next month with another rate hike which could lead to a reduction in household consumption.
Shin Se-byuck, Arirang News.