SEOUL, Feb. 20 (Korea Bizwire) – South Koreans’ household spending on food rose for the first nine months of last year, a sign of weak recovery in private consumption, data showed Tuesday.
Households spent a total of 573.6 trillion won (US$537.3 billion) during the January-September period, up 3.3 percent from a year earlier, according to the data from the Bank of Korea.
At the same time, household spending on food items rose 4.7 percent on-year to 78.9 trillion won.
Based on the data, the Engel’s coefficient for the country stood at 13.8 percent, up 0.2 percentage point from a year ago.
The coefficient is the proportion of food spending to total household expenditure, not including payments for tax, pension and insurance. Generally, if incomes go down, the proportion of spending on food increases, making Engel’s coefficient rise.
Chun Sung-in, an economics professor at Hongik University, said the figure showed that households tightened their belts last year, with middle- and low-income earners appearing to experience a decline in their income.
Last year, consumer prices grew 1.9 percent from a year earlier, sharply up from a 1 percent on-year rise in 2016, the steepest gain since 2012.
Core inflation gained 1.5 percent in 2017, the slowest pace of increase in 18 years.
The finance ministry expects South Korea’s inflation to rise 1.7 percent this year.