The dealers' room at the main branch of Hana Bank on June 16 in Seoul's Jung-gu District shows the benchmark Korea Composite Stock Price Index recovering to the 2,940 level for the first time in three years and five months. (Yonhap News)

By Margareth Theresia

Amid rising expectations of a supplementary budget and a stock market rally, public economic sentiment has risen to its most optimistic level in 11 months.

The Economic Statistics System of the Bank of Korea on June 17 said the news sentiment index (NSI) reached 108.43 as of July 13. The figure had grown to 109.05 the previous day, the highest since 110.86 on July 11 last year.

Announced every Monday and reflecting data gathered for that week, the NSI gauges public economic sentiment by analyzing sentences in economic and business news on leading web portals. A figure over 100 means more optimistic views than the long-term past average.

The alleviation of uncertainty in domestic politics is considered a major factor behind this recovery. The bank's political uncertainty index was 1.0 as of June 15, a drastic drop from a peak of 12.8 in December last year, rapidly reaching a safe level after the new government took office.

The positive mood has also boosted the stock market. For the first time in three years and five months, the benchmark Korea Composite Stock Price Index (KOSPI) on June 16 broke the 2,940 level thanks despite the latest escalation of the Mideast conflict, closing at 2,946.66, up 52.04 points or 1.8% from the previous trading day.

Another factor cited as raising economic sentiment was the government's bid to use a supplementary budget of over KRW 20 billion.

Foreign investment banks have also raised their outlooks for the Korean economy. Citibank in a recent report mentioned as opportunities for the country growth driven by expansionary fiscal policy, the potential for better diplomatic relations with China, and investment in artificial intelligence and renewable energy.

margareth@korea.kr