South Korea consumer confidence declines amid inflation and stock market correction

South Korean consumer confidence has declined for the first time in four months, according to data released by the Bank of Korea (BOK). The Composite Consumer Sentiment Index (CCSI) dropped by 2.3 points to 104.5 in August.

Key drivers for the decline include a correction in the domestic stock market and persistent inflationary pressures. While the index remains above 100—indicating that more consumers feel positive about the economy than negative—the sub-index for current economic conditions fell by 5 points to 79.

Economic growth continues to be supported by strong exports, but household purchasing power is being squeezed by high inflation, partly influenced by geopolitical tensions in the Middle East. Additionally, concerns regarding global artificial intelligence (AI) infrastructure investment have contributed to domestic market volatility.