Consumer sentiment hits nearly 3-year high in May amid economic recovery

South Korea's consumer sentiment rose to the highest level in almost three years in May as the country's economy is on a recovery path, central bank data showed Tuesday.

The composite consumer sentiment index (CCSI) came in at 105.2 for May, up 3 points from the previous month, according to the data from the Bank of Korea (BOK).

It marked the highest level since June 2018, when the sentiment index came to 106.3. The latest reading also represented the fifth straight month of on-month gain.

A reading above 100 means optimists outnumber pessimists.

The BOK said the index gained ground on expectations for an economic recovery and the country's efforts to speed up COVID-19 vaccinations.

Asia's fourth-largest economy grew 1.6 percent in the first quarter from three months earlier, accelerating from a 1.2 percent on-quarter gain in the fourth quarter of last year.

Exports, which account for half of the economy, jumped 41.1 percent on-year in April to extend their gains for the sixth consecutive month amid a global economic recovery.

Amid a flare-up in virus cases, the country has pumped up efforts to speed up the COVID-19 vaccine rollout with a goal of achieving herd immunity by November.

The subindex for people's assessment of current economic conditions rose to 85 in May, compared with 77 in April. The index gauging people's sentiment toward future economic conditions reached 99 this month, up 94 from April.

The index measuring inflation expectations ticked higher in May, indicating that people expected price pressure to build up amid an economic recovery.

The BOK said people forecast consumer prices to grow 2.2 percent over the next 12 months, up 0.1 percentage point from the previous month. The May reading marked the highest since the index came to 2.2 percent in May 2019.

The central bank aims to keep annual inflation at 2 percent over the medium term. (Yonhap)