Vietnam’s inflationary pressure under control this year, say experts

PhD. Nguyen Duc Do, deputy director of the Institute of Economics and Finance (Academy of Finance), says inflationary pressure is not expected to be high in 2024 because major world powers, especially the United States and China, are set to grow slowly.

Amid the slowing world economic growth forecast, Vietnamese exports in 2024 will probably grow moderately. Furthermore, the industry - construction sector and the entire economy in general will also be impacted and have low growth this year as the real estate market is anticipated to remain in the doldrums.

If GDP growth hovers around 6% in 2024 as planned, or the 4.64% recorded in the 2020 - 2024 period on average, the economy will still not operate within its capacity. This can be seen as a factor in curbing inflation, with the average inflation for the whole year forecast to be around 3% - 3.5%, which is lower than the 4% - 4.5% target set by the National Assembly, analyses PhD. Do.

Given the current and future context, the inflationary pressure will not be high, and more importantly, anti-inflation policies introduced by the State Bank of Vietnam have so far proved to be effective over the past 10 years, adds the expert.

However, to keep inflation in check for 2024, economic experts suggest that the Government, ministries, sectors, and localities all closely monitor the health of the world economy, especially in relation to major economic powers, in order to take appropriate response measures. Priority should therefore be given to ensuring the market law of supply and demand to stabilise domestic prices.

According to PhD. Vu Dinh Anh, a leading economic expert, Vietnam managed to keep the average consumer price index (CPI) at 3.25% by the end of 2023. If fuel and food were excluded in the commodity basket for inflation calculation, core inflation or basic inflation would still be above 4%.

The country should duly keep a close watch on monetary inflation factors in the year ahead, particularly those caused by public investment disbursement and credit increases, warns the economist.