Inflation expectations, which gauge the outlook among consumers over headline inflation for the next 12 months, stood at 3.8 percent in December, down 0.4 percentage points from the previous month, according to the Bank of Korea (BOK).
It was the lowest in seven months since May, keeping a downward trend for the second straight month.
After hitting a record high of 4.7 percent in July, the inflation expectations logged 4.3 percent in August, 4.2 percent in September, 4.3 percent in October and 4.2 percent in November respectively.
To counter inflation, the BOK launched the tightening of its monetary policy in August last year, raising its key rate from a record low of 0.50 percent to 3.25 percent.
The rate hikes led to lower home prices. The prospective index for housing prices slightly gained to 62 in December from an all-time low of 61 in the previous month.
The composite consumer sentiment index (CCSI) came to 89.9 in December, up 3.4 points from a month earlier.
It marked the first rebound in three months due to slower inflation that offset worry about export slump and global economic downturn.
The results were based on a survey of 2,380 households conducted between Dec. 12 and 19.
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