SEOUL Consumer sentiment in South Korea improved in May to the highest level in a year, with their inflation expectations weakening, a central bank survey showed on Tuesday.

The Consumer Sentiment Index rose to 98.0 in May from 95.1 in April, according to the Bank of Korea's monthly survey of consumers.

The index remained below 100 - the average of last two decades - for the 12th consecutive month, but it hit the highest level in the streak.

The median of consumers' inflation expectations for the next 12 months fell to 3.5% from 3.7%, also marking its lowest level in 12 months.

"It is too early to say inflation expectations are stabilising, with uncertainties remaining over public price increases and other factors," said a BOK official during a media briefing.

The survey was conducted during May 8-15, before South Korea decided to raise electricity prices by 5.3% in its second price hike for this year.

(Reporting by Jihoon Lee; Editing by Toby Chopra)