Vietnam’s September consumer price index (CPI) increased 2.2% against last month after price hikes in key goods including petrol, according to the General Statistics Office (GSO).
Vietnam’s September consumer price index increased 2.2% against last month
Economist Dr. Vu Dinh Anh said, this was a record high increase for September CPI.
The figures were quite surprising after the deflation of June and July and a slight CPI rise in August. The country’s September CPI increased 5.23% against December 2011 and 6.48% against last September. On average, in the first nine months CPI increased by 9.96% over the same period last year.
All 11 groups of goods and services used for the CPI calculation were on an upwards trend in September.
Medicine and medical service group sees the highest price rise with 17.02% against last month. Followed by education at 10.54%, transport 3.83% and housing-construction materials at 2.18%.
Food and catering services, accounting for 40% in the CPI’s price basket, increased marginally by 0.08% from the previous month.
The telecommunications group posts a slight increase of 0.01% from August, bringing its average monthly rise to a minus 1.34% so far this year.
Concerns
The CPI increase in September were “too high and unbearable”, economist Vu Dinh Anh said, adding that this is the highest level so far this year.
Every September, CPI increases often stand at below 1%, with a previous record high rise in September standing at 2%, according to the economist.
"The growth in inflation has been too sudden and this will be the biggest problem for the Vietnamese economy from now to the year end, even until 2013,” he commented.
The timing of some price adjustments of key products was not suitable, which had caused CPI to be much higher than the initially estimated rate of just 1% in September. This was a worrying issue, Anh emphasised.
Dr. Nguyen Duc Thanh, Director of Vietnam Centre for Economics and Policy Research (VEPR), also raised concern about the return of high CPI after the decision to raise the prices of many key products. He forecast that the country would face a budget deficit both this year and next year.
A recent report of Moody's Analytics showed that, Vietnam’s CPI was likely to increase again in the coming months due to higher electricity prices and the world market’s escalating food prices.
