National inflation for 2023 projected to be between 3.9% - 4.8%

The scenarios have been developed based on numerous calculations and forecasts of price fluctuations of groups of commodities that make up a large proportion of the consumer price index (CPI) basket of goods, including petroleum, food, electricity, construction materials, education, health care, and rental house rentals.

At a meeting of the national pricing committee held on March 24, the Ministry of Finance acknowledged that the global market has been badly affected by the ongoing Russia-Ukraine military conflict, a tight monetary policy, and rising inflation in many economies.

Amid this context, domestic commodity prices during the first months of the year remained relatively stable. Due to the impact of international prices, the prices of some petroleum products such as petrol, oil, and liquefied gas fluctuated correspondingly, while construction material prices increased in the first quarter.

Vietnam was not among the main countries recording high inflation, with its CPI in February inching up by 4.31% compared to the same period in 2021. However, the Ministry of Finance pointed out that the pressure to increase prices in April and the second quarter remains a possibility amid global uncertainties, particularly as many domestic essential goods heavily rely on world prices. Therefore, it forecast that the country’s inflation for the year would be kept at between 3.9% and 4.8%.

On the other hand, it assumed that if the CPI in the remaining nine months of the year rises at the same rate compared to that seen in the previous months, the average inflation target of 4.5% for the whole year can be achieved.

According to Nguyen Thi Huong, director general of the General Statistics Office (GSO), prices of a range of commodities decreased in the first quarter but remained high compared to the same period from last year.

Amid a high level of uncertainties globally, Huong suggested that relevant agencies strive to keep a tight grip on market fluctuations and produce a suitable roadmap for increasing prices of groups of commodities such as health care, education, and electricity.

Addressing the meeting, Deputy Prime Minister Le Minh Khai, who is head of the national pricing committee, requested that competent agencies closely monitor the world economy and inflationary pressure, promptly warn of risks that may impact the Vietnamese market and take appropriate response measures in a bid to ensure goods supply and stabilise domestic prices.

“Whatever we do, we must stay ready to take prompt response measures if the worst-case scenario happens, to ensure the market law of supply and demand and stabilize market prices, especially of essential commodities like food, petrol and oil," Deputy PM Khai said.

With regard to the monetary policy, the Deputy PM requested that the State Bank adopt a flexible management policy aimed at helping to control inflation and keep the value of the Vietnamese currency at a reasonable level, so as not to affect production and the business activities of enterprises.

He also requested that relevant ministries and sectors carefully study and evaluate influential factors if they want to hike the prices of electricity, educational services, medical examinations, and treatments, with proposals to be submitted to competent authorities for consideration and adjustments.