Expert believes inflation could fall below 4% this year
With the consumer price index (CPI) increasing by 1.47% during the first half of the year, the lowest rise since 2016, it remains entirely feasible for the country to keep inflation below 4% this year.
Nguyen Thi Huong, general director of the General Statistics Office (GSO), unveiled this information during a press conference held on June 29 in Hanoi, adding that escalating prices of fuel and input materials, coupled with the rising price of electricity and water, has caused June’s CPI rise of 0.19% compared to the previous month.
She also attributed the six-month CPI increase to adjustments in the domestic price of petrol, thereby making the average price soar by 17.01% and the overall CPI increase by 0.61%.
An upturn could also be seen in the price of domestic gas, which rose by 16.51% against the same period from last year, while the price of education services throughout the reviewed period recorded an rise of 4.47%.
Meanwhile, the domestic price of rice witnessed an upward trend in line with the export price of rice, while a high demand for glutinous and plain rice during the Lunar New Year caused the price of rice during the reviewed period to increase by 6.97% on-year, making the overall CPI increase by 0.18%.
Elsewhere, housing and construction materials rose by 0.63% to push the general CPI up by 0.12%. The price of materials for housing maintenance surged by 1.26% to fall in line with the price of input raw materials and fuel.
However, there remains a number of factors which have curbed the CPI growth rate in the first half of the year. Notably, the price of food witnessed an annual fall of 0.39%, making the overall CPI decrease by 0.08%.
Following the deployment of bailout package from the Government for individuals and businesses impacted by COVID-19, the average price of electricity also dropped by 3.06%, resulting in the general CPI falling by 0.1%.
Moreover, the decline in people's travel and tourism demand due to the COVID-19 impact has also made the price of package tours plunge by 2.85% compared to the same period from last year.
Core inflation in June saw an increase of 0.07% over the previous month and 1.14% compared to last year’s corresponding period, fuelling the six-month core inflation to inch up by 0.87% from the same period last year.
The 2020 Consumer Price Index (CPI) in Vietnam was contained at 3.23%, but which will be difficult to maintain at a target of 4% in 2021.