Vietnam keeps watchful eye on inflation after fuel hikes
Prime Minister Nguyen Xuan Phuc has ordered electricity prices and toll fees to be kept stable this year to control inflation and allow the economy to grow, according to the government website.
Consumer prices in May had the biggest month-on-month increase since 2012.
At a government meeting on June 2, the newly-elected PM also demanded his cabinet keep close watch on fuel prices, which are rebounding following the recovery in global oil prices. Gas prices in Vietnam were increased twice last month, up nearly 6% in total.
A report by the Ministry of Planning and Investment showed crude prices rose 80% in the past five months and will likely continue to go up for the rest of the year. Since March, local pump prices have seen four consecutive hikes.
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Phuc, who also ordered his cabinet to stabilize food prices, said the Vietnamese government will maintain a price cap on formula products for babies under six years old until the fourth quarter.
That means Vietnam will unlikely lift the ceiling it applied two years ago in July, as promised by Finance Minister Dinh Tien Dung when he met with the US Trade Representative Michael Froman last month.
Vietnam's consumer price index rose 0.54% from April. Compared to December, it was up 1.88%, according to official data.
The government expects inflation to be around 5% this year, after a record low of 0.63% last year.
