S. Korean consumer sentiment remains flat in July

SEOUL, July 26 (Yonhap) -- South Korea's consumer confidence stayed flat in July as concerns about high inflation and growing household debt overshadowed recovery optimism, the central bank said Tuesday.
The consumer sentiment index (CSI) -- a gauge of consumers' overall economic outlook, living conditions and future spending -- stood at 102 for July, unchanged from the previous month, the Bank of Korea (BOK) said in a monthly report.
The sentiment index stayed above the benchmark 100 for the fourth straight month in July after the index, a gauge of future private spending, fell below the 100-point level for the first time in 23 months in March.
A reading above the benchmark 100 means optimists outnumber pessimists. The survey, based on a poll of 2,015 households in 56 cities, was conducted from July 13-20.
"The index gauging households' assessment and projection of debt remained high, indicating that household indebtedness weighed on sentiment," said Jang Wan-sub, an official at the BOK.
The data comes as the South Korean economy is facing growing inflationary pressure amid lingering economic uncertainties at home and abroad. Growing household debt, which reached around 800 trillion won (US$742.1 billion) as of end-March, is weighing on consumer sentiment as heavy indebtedness is feared to curb economic growth.
The sub-index gauging households' current assessment of debt came in at 109 in July, up from 108 the previous month and the highest level in four months, the BOK said. The index measuring their outlook for indebtedness rose two points to 106 in July, marking the highest level since March.
The growth of South Korea's consumer prices surpassed the upper ceiling of the BOK's 2-4 percent inflation target band for the sixth consecutive month in June.
South Korean consumers in July expected inflation to reach an annual average of 4 percent over the next 12 months, up from 3.9 percent estimated in the previous month, according to the BOK.
Meanwhile, the sub-index measuring consumers' assessments of current economic conditions fell by one points to 76 in July, but the index gauging their outlooks for the economy reached 88 for July, up from 86 in June, the BOK noted.