return icon Vietnamnet.vn

Vietnam to control CPI growth at less than 3 percent

If Vietnam could control inflation cautiously and proactively, the CPI for the whole of 2021 would rise by below 3 per cent, said an expert in Hanoi last week. 

{keywords}

The CPI increased in H1 due to increases in petrol and oil prices, the price of educational services, the price of rice and of construction materials. — Photo kinhtevadubao.vn

 

Le Quoc Phuong, former deputy director of the centre for Industry and Trade Information from the Ministry of Industry and Trade, told a conference on prices in the first half of the year that the country maintained low inflation in 2021.

According to the conference held by the Institute of Economic and Financial Economics and the Price Management Department from the Ministry of Finance, the price level in H1 was normal, inching higher during the Tet (Lunar New Year) festivals and falling back at other times.

A representative of the General Statistics Office (GSO) said compared to the last month of 2020, January's CPI increased by 0.06 per cent and February’s by 1.52 per cent. The CPI decreased by 0.27 per cent in March, by 0.04 per cent in April, increased by 0.16 per cent in May, and was up 0.19 per cent in June.

After the first half of the year, the CPI increased by 1.47 per cent over the same period in 2020, the lowest increase since 2016.

Nguyen Ba Minh, director of the Institute of Financial Economics, said the CPI increased in H1 due to increases in petrol and oil prices, the price of educational services, the price of rice and of construction materials.

Factors pushing down CPI growth included food prices, the deployment of Government support packages, as well as less travel due to the impact of the pandemic.

Nguyen Duc Do, deputy director of the Institute of Economics and Finance, said due to the decline in domestic demand, the core inflation in June increased by 0.07 per cent from May and by 1.14 per cent from April. Lower core inflation along with the decline of food prices such as pork and chicken had balanced out the impacts of gasoline prices and rising prices of construction materials, said Do.

Regarding H1’s low inflation, economist Ngo Tri Long said: “It is a favourable condition to create room to control inflation for the whole year to reach the target.”

Long added: “However, Vietnam should not lose focus as inflation pressure will continue to increase from now until the end of the year. The prices of raw materials and materials for production increased sharply by 4.79 per cent in the first half, which is the highest level since 2013."

Nguyen Ba Minh predicted average CPI in 2021 would be at 2.5 per cent, 0.3 percentage points higher than 2020, forecasting the prices of some essential goods will cool down, market prices will be stable and there will be no fluctuations.

The department forecast the inflation risk in 2021 was not high, so the average annual inflation of less than 4 per cent was to be met.

Nguyen Duc Do said that weak aggregate demand due to COVID-19 was the basic reason for low inflation in Vietnam in the context of high prices of basic commodities globally, adding: “The target of controlling average inflation to below 4 per cent in 2021 will certainly be achieved. However, low inflation due to weak aggregate demand is not necessarily a good thing."

Do calculated if the price growth was maintained for the rest of the year at about 0.27 per cent each month, the inflation over the same period last year would increase from the current 2.41 per cent to 3.2 per cent in December and the average inflation for the whole year would be at 2.12 per cent.

If the gasoline prices continued to rise sharply and CPI was assumed to increase by an average of 0.5 per cent per month, inflation by December 2021 would be at 4.71 per cent and the average inflation 2.53 per cent.

At the conference, Dinh Trong Thinh, from the Academy of Finance, proposed two scenarios for CPI in 2021. If the pandemic continues and the world economy recovers slowly, Vietnam's economy would increase at 6.8 to 7 per cent, the inflation rate for the whole year would be around 3.3 to 3.5 per cent; and if the economy grew at between 7 and 7.4 per cent, the inflation rate would be at 3.8 to 4 per cent.

Le Quoc Phuong, said to keep the CPI of the whole year below 3 per cent, it was necessary to closely monitor the price movements of essential commodities and not increase the prices of items in the current context.

Phuong added: “We need to manage the prices of a number of commodities well, such as iron and steel, gasoline, aviation services, medical services, land, and real estate. It is necessary to prepare a reserve of goods to meet consumer demand, to avoid scarcity that pushes prices up sharply.”

The experts at the conference said the Government should focus on operating monetary, interest rate and exchange rate policies in a flexible and prudent manner, in line with domestic and international market developments, in coordination with other countries. It was also necessary to harmonise fiscal policy and other macro policies, in order to control inflation, support production and business and promote economic growth.

Source: Vietnam News

Rising trends likely to persist for 2021 consumer price data

Rising trends likely to persist for 2021 consumer price data

On the back of reopening global economies and a rising crude oil price, Vietnam’s inflation target for 2021 may be harder to achieve, with regulating government bodies attempting to manoeuvre through the year while keeping inflation pressure at bay.

Inflation expected to be reined in for 2021

Inflation expected to be reined in for 2021

In a bid to continue successfully controlling inflation this year amid a rise in local consumption, the government is taking drastic action, with the stabilisation of prices of key items in the market a priority.

MORE NEWS

Vietnam proposes to issue ID cards to people without Vietnamese nationality

Non-Vietnamese nationals living in Vietnam will likely be granted an electronic identification account to perform public administrative procedures.

VN, Hungary’s parliaments sign new cooperation agreement

A new cooperation agreement between Vietnam and Hungary’s national assemblies was assigned by National Assembly (NA) Chairman Vuong Dinh Hue and his Hungarian counterpart László Kövér in Budapest on Monday.

Australia pledges to continue fostering strategic partnership with Vietnam

Australian Foreign Minister Penny Wong has affirmed that her nation always attaches importance to Vietnam's role in the region, and pledges to continue strengthening its strategic partnership with the Southeast Asian nation.

Ben Tre coconut-based dishes set World Record

The World Records Union (WorldKings) and the Vietnam Records Organisation (Vietkings) on June 27 recognised the 222 coconut-based dishes cooked at an event held in the Mekong Delta province of Ben Tre.

Health Ministry yet to consider COVID-19 endemic disease

The Ministry of Health has proposed considering COVID-19 a Group A infectious disease, not an endemic disease in its latest draft on COVID-19 prevention and control measures in the new situation.

E-commerce enabler OnPoint raises $50 million from Singapore fund

OnPoint has successfully raised $50 million in a series B fund-raising round from SeaTown Private Capital Master Fund managed by SeaTown Holdings International, an indirect wholly-owned subsidiary of Singapore’s Temasek Holdings.

SARS-CoV-2 Omicron sub-lineage BA.5 enters Vietnam

The SARS-CoV-2 Omicron sub-lineage BA.5 has entered Vietnam and may overwhelm the old sub-lineage BA.2 which is dominant in the country, according to Prof. Dr. Phan Trong Lan, Director of the Health Ministry’s Department of Preventive Medicine.

HCM City promises to ease problems faced by Korean investors

The chairman of the Korean Chamber of Commerce and Industry in Vietnam, Shon Young Il, has called on HCM City authorities to help Korean firms resolve difficulties they face in investing and operating in the city.

VIETNAM NEWS HEADLINES JUNE 27

Newly-appeared low pressure zone in East Sea may develop into storm

VIETNAM BUSINESS NEWS JUNE 27

Vietnam’s exports to Hungary on the rise

Football star to join France's Pau FC

Vietnam’s football star Nguyen Quang Hai will play for Pau FC in Ligue 2, France’s second division.

Multiple int’l air routes to Danang to be reopened by year-end

Multiple international air routes linking Danang City and regional destinations will be reopened from now until the end of 2022, giving an impetus to tourism growth in the city.

One of a kind: banana species needs boiling, non-sour citrus fruit sells out

While regular bananas need time to become ripe, a particular type in Vietnam requires boiling or grilling to reach its maximum taste. In Vietnam, there is also a unique citrus fruit, not sour but sweet.

VN animation project depicts traditional culture

A short film depicting Vietnamese traditional culture, U Linh Tích Ký: Bột Thần Kỳ (Linh: Magic Powder), has attracted viewers on YouTube.

NBA gets first Vietnamese-origin players

The National Basketball Association (NBA)'s Oklahoma Thunder selected Jaylin Williams, a 2.08-metre power forward from the University of Arkansas in the fourth pick of the second round of the draft on Friday (June 24).
back_to_top