The forex market has seen heavy fluctuations amid a tense situation as the US has raised interest rates as well as other central banks. The high prices of USD have affected the Vietnamese dong.

The State Bank of Vietnam (SBV) has given credit room extension to some commercial banks, paving the way for more money to be pumped into the economy. But capital is being released in dribs and drabs.

Though the consumption and use of services have increased compared to the peak of the COVID-19 pandemic, consumer demand is still low while commodity prices have reached a new height.

The inflation pressure eased significantly in August on Government efforts to bring down petrol prices although prices of other goods and services kept increasing, according to the General Statistics Office.

Inflation in many developed economies has led to a sharp decline in the demand for many of Vietnam’s export products.

The nation has seen food prices remain stubbornly high despite the recent sharp decline in gasoline prices.

Despite difficulties, the government has been striving for a GDP growth rate of 7 percent, an inflation rate of below 4 percent and a credit growth rate of 14 percent this year.

After two years of enforcement, the EU - Vietnam Free Trade Agreement (EVFTA) has generated initial results, but rising inflation in the EU and the euro depreciation are affecting Vietnamese firms, requiring urgent solutions to those difficulties.

Lending interest rates in the remaining months of this year will stay relatively stable to help firms recover production after the pandemic.

The State Bank of Vietnam is facing multiple pressures in 2022 in managing the foreign exchange rate

Although global inflation is a reality, the general feeling is that inflation is still under control. However, continued rising inflation is bound to affect the efforts of the Government to make full economic recovery.

The Ministry of Finance again proposed the Government lower the MFN tariff on unleaded gasoline to 10% from 20%, instead of 12% as earlier suggested, apart from efforts to cut the environmental protection tax on fuels to the floor level.

“VND50,000 please. No, just VND30,000."  “VND100,000, please. No, only VND70,000." These were conversations I heard yesterday at a filling station.

Vietnam’s consumer price index (CPI) in the January – June period rose by 2.44% year-on-year while its core inflation edged up 1.25%, the General Statistics Office (GSO) reported at a press conference on June 29.

The economic crisis caused by the Covid-19 pandemic has been followed by the economic crisis associated with the Russia-Ukraine conflict.

In addition to the risk of bad debts owed by Covid-hit customers, the rise of deposit interest rates rapidly rising is seen as the main risk for the banking system now and in the future.

The petrol price hike has led to price escalations of major goods and services, forcing low-income earners to tighten their belts.

If inflation cannot be controlled and Vietnam has to use a “high-dose drug”, such as an interest rate increase, serious consequences may occur.

The goal of maintaining inflation at 4% this year will be threatened unless viable solutions are introduced in a bid to rein in rapidly-increasing petrol prices, according to economic experts.

The world is witnessing the highest inflation in decades. Many economies around the world face a risk of recession.