Koreans are spending more on food, clothing and accommodation, as they become more confident about economic outlook, data showed yesterday.

Consumer spending on basic living needs increased 6.7 percent in September, according to data from the Finance Ministry and Statistics Korea. It is the fastest pace of growth since October 2007.

Consumption of clothes rose 1.6 percent in September from a month earlier, in a turnaround from a year of decline. In December last year, spending on clothes plunged 15.7 percent.

Sales of quasi-durable goods, such as clothes, shoes and bags, increased 2.5 percent, the fastest gain since August last year. Fashion products are among the consumer items most sensitive to economic cycles.

Car sales registered a 65.8 percent growth over the same period, the fastest pace of monthly growth on record. In November last year, it had dropped 28.4 percent.

Improvement on the consumer side is seen essential for Korea to recover from the global economic crisis, after the government spent massive amounts out of state coffers in order to jumpstart the economy.

Consumers kept their wallets closed until early this year, after a sharp contraction of the Korean and global economy shattered their confidence.

In December last year, when the crisis was at its height, consumer spending on food, clothing and accommodation shrank by an average 7 percent, the largest drop since the 1997-98 Asian financial crisis.

However, consumer confidence is improving quickly, buoyed by a flurry of positive economic news.

"Consumer sentiment is fast recovering from the second quarter on, as the economy picks up faster than expected," an official at the Finance Ministry said.

Korea's gross domestic product increased 2.9 percent in three months through September from three months earlier, the fastest pace of growth in more than seven years.

The consumer confidence index rose to its highest level in more than seven years in October, while sales at the nation's major department stores rose for a seventh consecutive month in September.