consumer sentiment-March tally

SEOUL, March 27 (Yonhap) -- South Korean consumers' confidence rose to the highest level in 10 months in March due to signs of the global economic recovery and the new government's economic stimulus measures, the central bank said Wednesday.

The consumer sentiment index (CSI) -- a gauge of consumers' overall economic outlook, living conditions and future spending -- came in at 104 for March, up from 102 tallied for the previous month, according to a monthly survey by the Bank of Korea (BOK).

The March reading marked the highest level since 106 recorded for May 2012.

A reading above the benchmark 100 means optimists outnumber pessimists. The survey, based on a poll of 2,037 households nationwide, was conducted from March 12-19.

"Consumer confidence rose as improvements in some data in the U.S. and China raised hopes for the global recovery," a BOK official said. "Optimism over the government's stimulus packages also seemed to be reflected."

The government is anticipated to unveil a set of measures to boost the economy later this week, which would include 10 trillion won (US$9 billion) in extra budgets.

Market analysts are divided over whether the BOK will cut the key interest rate to 2.5 percent in April. The BOK froze the benchmark rate at 2.75 percent for the fifth straight month in March.

The sub-index measuring current economic conditions reached 73 for March, up from 69 in February. The indicator gauging inflation outlook reached 138 for this month, compared with 137 in February, the BOK added.

The Korean economy is likely to grow 2.8 percent this year, hovering below its long-term growth potential of some 3.8 percent. But the central bank said that the economy will pick up to 3.5 percent in the second half after growing 1.9 percent in the first half.

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