Oct 30, 2020 / 11:33

Vietnam October inflation hits 5-year low at 0.09% m/m

Core inflation comes at 2.52% year-on-year in the first ten months of 2020.

Vietnam's consumer price index (CPI), the main gauge of inflation, in October edged up 0.09% against the previous month and versus the end of 2019, both at the weakest levels in the 2016 – 2020 period, according to the General Statistics Office (GSO).

 Vietnam's CPI in the first ten months of this year increased by 3.71% year-on-year. Photo: Hai Linh

Inflation in the January-October period was 3.71% from a year earlier, the government-run office said in a monthly report on October 29.

Increases in prices of education, as well as the impacts of heavy rains and flooding in the central region led to an expansion of the CPI in October, stated the GSO.

Overall, the CPI in the first ten months of this year increased by 3.71% year-on-year.

Six out of 11 commodity groups that are components of the basket for CPI calculation witnessed month-on-month price hikes. Among them, education posted the sharpest increase of 1.35%, mainly due to hikes in tuition fees in 9 provinces and cities for the 2020 – 2021 academic year, contributing 0.08 percentage points to the overall growth of CPI.

Other groups that saw their prices up in October were housing, water and electricity supply, and construction materials (0.29%); beverages and cigarettes (0.08%); garment, footwear and hats (0,06%); medicine and healthcare services (0.01%); and other goods and services (0.09%).

The remaining groups that saw their prices down in October were culture, entertainment, and tourism (-0.18%); food and catering services (-0.13%); transportation (-0.08%); post and telecommunications (-0.03%); while prices of household equipment and appliances remained unchanged.

According to the GSO, core inflation in October came at 0.07% month-on-month and 1.88% year-on-year, leading to an increase of 2.52% in the ten-month period.

Domestic gold prices continued the volatile trend due to global uncertainties caused by the Covid-19 pandemic and unpredictable outcome of the upcoming US election.

In October, gold prices in Vietnam declined by 1.1% month-on-month but soared 30.91% against last December and 29.63% year-on-year.

This year, the government targets to keep inflation below 4%, while the GDP growth is set to expand in range of 2 – 2.5%.