Consumer Sentiment Likely Weakened Amid Iran War Fallout

Key indicators measuring shifts in consumer sentiment following the U.S.-Iran war will be released this week. Park Hong-geun, nominee for Minister of Strategy and Finance, is expected to outline the government's fiscal policy direction during his National Assembly confirmation hearing.

The Bank of Korea will release the results of its March Consumer Sentiment Survey on the 25th. The Consumer Confidence Composite Index (CCSI) had maintained an upward trend for two consecutive months through last month, buoyed by strong exports including semiconductors and a buoyant stock market. However, consumer sentiment is expected to have contracted in March as oil prices climbed sharply amid Middle East tensions. The housing price outlook index, which fell by its largest margin in three years and seven months (-16 points) last month due to government real estate regulations, is also drawing attention.

The National Data Agency will release "January Population Trends" on the 25th. Attention is focused on whether the streak of rising births, which continued for 18 consecutive months through December last year, extended into the new year.

Internationally, markets are watching how volatile oil prices and financial markets will become amid signs of escalation and prolongation of the Middle East conflict.

The Boao Forum, often called "China's Davos," also draws interest. Running for four days starting March 24, the forum's agenda includes global affairs and development directions, regional cooperation and growth drivers, and expanding development potential through innovation.

Interest is heightened with the Iran war overlapping with U.S.-China hegemonic competition. Key global economic issues including artificial intelligence, digital transformation, green economy, and free trade are expected to dominate discussions. China is also expected to promote its investment environment by showcasing results from the "Fengguan" operation, which designates all of Hainan Province as a special customs zone. Fengguan is a strategy to expand external opening through duty-free expansion and simplified customs procedures, developing Hainan into an international trade hub.

Additionally, as this year marks the starting point for China's 15th Five-Year Plan (2026-2030), China is expected to emphasize messages of economic recovery and expanded external opening.