>> November CPI records highest increase in 15 years
>> Hanoi’s CPI up 1.93 percent in November
>> NA Deputy talks about inflation and economic policy
Vietnam’s consumer price index (CPI) has been predicted to increase by 11% this year, according to a local expert.
 |
| Food prices tend to increase |
This is the prediction from Dr. Nguyen Minh Phong, from the Institute for Economics and Social Development and Research.
He said it is consecutive gold price rises over recent months, even VND1 million (USD50), higher than the world level, has caused pressures for price increases in all commodities.
At a press conference on November 30, the Ministry of Industry and Trade said it is challenging for Vietnam to keep CPI at single figures when it is forecast to grow between 1.3% and 1.5% in December against November.
According to the ministry, the situation is due to the sharp rise of goods prices over the past three months amid the world market’s material price hikes. The recent floods in the central region and diseases in poultry in many localities have also seriously affected food supply and people’s production activities, resulting in price hikes.
However, Deputy Minister of Industry and Trade Ho Thi Kim Thoa said, “The CPI change maybe attributed to speculation and consumer factors.”
Dr. Le Tham Duong, from the Ho Chi Minh City Banking University, said he agreed with the explanation given by the ministry, also blaming the price leaps for the decision of the State Bank of Vietnam to raise base interest rates to 9% per year from November 5. The bank’s move was aimed to attract people’s idle capital but in actually, partially increased commodity prices.
Duong elaborated that Vietnam still faces latent risks to control CPI in December, forecasting that “Inflation can hover around 11% this year”.
It was also suggested that, “The state should ensure goods supply when consumption demand is drastically on the rise before the Lunar New Year and also take stern actions against commodity speculation activities. This will help to improve the situation.”
According to the General Statistics Office, CPI in November recorded the highest increase Vietnam has seen in the past 15 years. The November CPI surged by 1.86% over October and by 11.9% year-to-year, bringing the January-November CPI up by 9.58% over December 2009 and 8.96% against the average of the same period in 2009.
