Consumer confidence in South Korea rebounded significantly in February, reaching its highest level since last November, primarily supported by strong semiconductor exports and a robust domestic stock market. Data released by the Bank of Korea on Friday showed the Composite Consumer Sentiment Index rose to 112.1 in February, marking a notable increase from January and remaining above the neutral threshold of 100, indicating overall optimism among households regarding economic prospects. This reading is the highest since November of last year. The improvement in consumer confidence was mainly driven by a more positive assessment of current economic conditions and brighter expectations for future economic prospects. The recovery in market sentiment reflects continued improvement in export momentum, particularly strong performance in semiconductor-related exports, while the upward trend in the domestic stock market also provided significant support. In the equity market, South Korea's benchmark KOSPI index has more than doubled compared to a year ago, largely driven by substantial gains in heavyweight semiconductor stocks. Notably, sustained share price increases in Samsung Electronics and SK Hynix have been key drivers of the index's rise. However, contrasting with the overall improvement in consumer confidence, sentiment related to real estate showed a marked cooling. The sub-index measuring house price expectations fell to 108 in February, its lowest level since last April, dropping sharply by 16 points from the previous month. Analysts attribute this shift to the government's recent real estate market control measures, including efforts to curb speculative home purchases and signals that temporary tax benefits are nearing an end, such as the impending expiration of a grace period for capital gains tax surcharges on multiple property owners. The divergence between strengthening overall consumer confidence and weakening real estate expectations may help alleviate the central bank's concerns regarding financial stability. Cooling house price expectations could restrain further leveraging by households, thereby mitigating risks associated with household debt. Market participants widely expect the Bank of Korea to keep its benchmark interest rate unchanged at 2.5% for the sixth consecutive time at its policy meeting on Thursday. In its January policy assessment, the central bank had already shifted to a more neutral monetary policy stance, citing factors such as persistently high household debt levels and ongoing exchange rate volatility risks. Although monetary policy is likely to remain on hold in the near term, analysts anticipate that, against the backdrop of strong global semiconductor demand driven by the artificial intelligence boom, the Bank of Korea may raise its 2026 economic growth forecast to 2.0% from the 1.8% projected last November.