Jul 04, 2019 / 17:49

Vietnam 2019 inflation projected to stay below 4% target

Both scenarios for inflation in 2019 presented by the government indicate inflation will be in the range of 3.17 – 3.41%.

Vietnam’s inflation is projected to be 3.41% in 2019, much lower than the government target of 4%, according to Deputy Prime Minister Vuong Dinh Hue. 
 
Overview of the meeting. Source: VGP.
Overview of the meeting. Source: VGP.
The public services fees, therefore, should be adjusted in parallel, Hue said in a government meeting on July 3. 

Vietnam’s consumer price index, a gauge of inflation, declined 0.09% month-on-month in June, leading to the expansion of the average CPI in the six-month period at 2.64% year-on-year, the lowest rate recorded over the past three years, said Nguyen Bich Lam, head of the General Statistics Office. 

Nguyen Van Truyen, deputy director of the Ministry of Finance’s Price Management Department, attributed the low expansion of CPI in the January – June period to a decline in prices of food, fuel and telecommunication services, among others. 

Additionally, government agencies have been closely supervising prices of centrally-administered goods and services, ensuring the balance between supply and demand, Truyen added. 

The government forecast prices for certain goods could be on the way up from now on until the end of the year, mainly due to strong volatility of oil prices in the world market; price adjustment for goods and services under state management, including healthcare and education, based on market mechanism; wage increase; natural disaster and unfavorable weather conditions.

On the contrary, there remain factors that could relieve pressure on price increase, including the potential decline in rice prices in the world market, stable prices of construction materials, and consistent foreign exchange policy. 

Truyen suggested two scenarios for inflation rate in 2019, both are in range of 3.17 – 3.41%, compared to the target of 3.3 – 3.9% set in the previous meeting.

Under such circumstances, goods and services under state management could be subject to further price upward adjustment in the fourth quarter of 2019, Truyen continued.