CPI below 5pct target

31-Dec-2016 Intellasia | The Saigon Times | 6:00 AM Print This Post

The consumer price index (CPI) this December is forecast to pick up 0.23 percent against a month earlier, and a mere 4.74 percent from the year before, below the 5 percent target of the government.

Data of the general Statistical Office shows the December CPI increase is mild as six out of 11 groups of items used to determine the CPI are up in prices but have small weights in the basket.

Medicine and healthcare services have recorded the highest rise of 5.3 percent compared to November, with healthcare alone shooting up 6.93 percent.

The remaining five groups are beverages and tobacco with an increase of 0.21 percent; apparel, headwear and footwear 0.25 percent; housing and construction materials 0.19 percent; household appliances 0.08 percent; and other goods and services 0.1 percent.

Meanwhile, four groups of goods have registered price falls, with all of them having big weights in the basket of goods used for CPI calculation. That includes food and catering services with a decline of 0.03 percent when foodstuff is down 0.12 percent, food up 0.22 percent, and dining services up 0.07 percent against the previous month.

Even though the December 19 fuel price hike was the biggest this year, transport services costs have edged 0.89 percent lower than November.

The other two groups whose prices are down are post and telecommunication (0.03 percent) and culture, entertainment and tourism (0.02 percent). Education is the only group with flat prices.

The 4.74 percent CPI increase versus December 2015 is below 5 percent the government promised before the National Assembly earlier this year.

At a meeting of the Price Steering Committee a week ago, deputy prime minister Vuong Dinh Hue stressed the government could accomplish the goal of keeping inflation below 5 percent this year. This is a success of the government given signs of inflationary pressure.

With adjustments of prices of medicine and healthcare services in line with an approved roadmap, this group’s prices by this December have surged 55.72 percent over the year-ago period, whereas other groups have registered lower growth than the average.

On the annualised basis, the CPI of 2016 is only 2.66 percent higher than in 2015. The above figures are all lower than previous years.

This month’s core inflation, which excludes food, foodstuff, energy and commodities whose volatile prices are managed by the State, such as healthcare and education, is up 1.87 percent from the same period this year. Headline inflation of 2016 is up 1.83 percent from 2015.

The CPI in rural areas is up 4.79 percent this month compared to the same period last year. In urban areas, the reading is 4.67 percent.

Many northern cities and provinces have reported a decline in the December CPI, including Hanoi, Thai Nguyen and Hai Phong. In contrast, southern and central localities have posted an increase that is even above the national average of 0.23 percent, such as HCM City (0.52 percent), Khanh Hoa (0.51 percent), Can Tho and Thua Thien-Hue (0.25 percent).



Category: Economy, Vietnam

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