However, pressure from the US$/VND exchange rate, rising production costs and slowing exports pose challenges for macroeconomic management in the remainder of the year.

Sustained recovery

Associate Professor Nguyen Dao Tung, Director of the Academy of Finance, said the economy has moved beyond short-term recovery and entered a clear growth phase since the second quarter of 2024. Momentum extended into 2025, with GDP expanding 7.96% in the second half of this year, lifting first-half growth to 7.52%- the highest in more than a decade.

Unlike previous periods when exports played the dominant role, current growth is driven largely by domestic consumption, up 7.95%, and investment, up 7.98%. Supportive fiscal policies, tax relief, faster public investment disbursement, and accommodative monetary measures such as rate cuts, credit expansion and flexible exchange-rate management have provided a solid boost for businesses.

Business confidence also improved, with more than 128,200 new enterprises established in the reviewed period, up 15.7% year-on-year and creating about 538,000 jobs.

Macro stability has been maintained. Core inflation in August rose 0.19% from the previous month and 3.25% year-on-year. On average, core inflation over the period January-August soared 3.19% year-on-year, slightly below the overall CPI increase of 3.25%.

Still, Tung cautioned that a global slowdown, driven by trade tensions and US tariff policies, could weigh on Vietnam’s exports. At home, rapid money supply growth and rising exchange rates in the first half of the year carry inflation risks, though subdued global commodity prices may help ease production costs.

Inflation under control

Average CPI surged 3.25% year-on-year during the past eight months, within the target range. Price pressures came mainly from health care, housing, utilities, construction materials and dining services. However, falling global commodity prices pushed Vietnam’s import price index down 1.57%, thus easing cost pressures.

Nguyen Duc Do, Deputy Director of the Institute of Economics and Finance, forecast CPI could rise an average of 0.27% per month in the second half, bringing full-year inflation to about 3.4%.

In the event of a sharp global downturn, inflation may stay around 3%. He emphasized, however, that the US$/VND exchange rate remains unpredictable.

Despite a weaker US dollar globally, the local rate has increased due to weaker exports, interest rate gaps and trade deficits. With a 16% credit growth target and low interest rates to support 8% GDP growth, money supply may expand quickly, adding to inflationary pressure.

At the same time, weak exports have left domestic supply in surplus, helping curb price increases. “This paradox indicates that growth challenges can, in turn, ease inflation risks,” Do said.

A Finance Ministry pricing official said price management in the coming months will require flexibility and close coordination between fiscal and monetary policies. Public service price adjustments must continue in line with market mechanisms but should be implemented cautiously to avoid CPI shocks.

Economist Ngo Tri Long projected inflation of 4-4.5% for 2025, still within a safe range given global uncertainties. He recommended the government prioritize exchange-rate stability, fuel price control, tighter cost management and faster public investment disbursement, while ensuring transparency and effective policy communication.

With GDP growth holding strong and inflation contained, analysts say Vietnam is building a solid foundation for the next stage of development.

PM requests double-digit growth scenarios for national economy in 2025

VOV.VN - Prime Minister Pham Minh Chinh has recently signed an official dispatch, asking ministries, sectors, and localities to develop scenarios for achieving double-digit economic growth in 2025.

National economy beats growth target, six-month GDP at 6.42%

VOV.VN - The national economy of Vietnam has maintained its upward trajectory, expanding by 6.93% in the second quarter of the year, thereby raising first-half growth to 6.42%, reported the General Statistics Office on June 29.