Inflation rate prediction 3.9% – 4.8% in Vietnam 2023

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The Ministry of Finance (MOF) recognizes that the upward pressure of prices in the second quarter remains and the pressure inflation forecast for this year still increases from 3.9% to 4.8%, close to the assigned target of 4.5%.

This forecast was stated by the Ministry of Finance at the Steering Committee for Price Management meeting on March 24, chaired by Deputy Prime Minister Le Minh Khai.

The consumer price index (CPI) in March decreased by 0.1-0.2% compared to February but increased by 3.4-3.5% over the same period last year. On average, in the first quarter, CPI is estimated to increase by 4.2-4.3% over the same period in 2022, according to the General Statistics Office.

Inflation increased in the first quarter mainly because the groups of goods and services accounted for the main weight in the CPI basket with an upward trend. For example, the price of construction materials increased by 7.2% leading to an increase of 1.4% CPI. Food items are more expensive by 4.5%, pushing the consumer price index by 1%.

There are also some declined items, such as petrol 11%, gas 1.8%, and post and telecommunications group 0.3% which helped CPI in the first three months of the year down 0.03-0.4%

However, the Ministry of Finance acknowledges the upward pressure on prices in April and the second quarter face to international situations and local essential goods depend heavily on world prices.

MOF provides a forecast scenario for this year, increasing by 3.9-4.8% compared to 2022. The scenario is based on calculations and forecasts of increasing pressure, a decrease in prices of commodities that account for a large proportion in the CPI basket of goods such as gasoline, foods, rice, pork, cost of living electricity, construction materials, education, medicine economy, and rental housing.

MOF assumes, in the remaining 9 months, CPI increases at the same rate compared to the previous months then the consumer price index each month has room to increase by 0.52%. This will ensure the average inflation is controlled target of 4.5%

Deputy Prime Minister Le Minh Khai chaired the meeting of the Steering Committee for Price Management in the first quarter on March 24. Photo: VGP
Deputy Prime Minister Le Minh Khai chaired the meeting of the Steering Committee for Price Management in the first quarter on March 24. Photo: VGP

Based on three scenarios for forecasting inflation this year, Deputy Prime Minister Le Minh Khai asked the Ministry of Finance carefully review and analyze input-output parameters scenarios. The operating scenario must closely follow the fiscal and monetary policies and control inflation follow to target, striving to achieve 4.5% lower than the plan.

Prices of many commodities decreased in the first quarter but remained at a high level and growth was more difficult than in 2022, according to General Director of the General Statistics Office Nguyen Thi Huong. In the future, instability is very high, and many factors are out of control, Ms.Huong suggested strict management and an increased schedule suitable for items such as healthcare, education, and electricity.

Regarding education services, a representative of the Ministry of Education and Training reported, the government has decided to keep the tuition fee as of 2021-2022, tuition fees will not increase until August 2022-2023. The Ministry is coordinating with offices of government to research and propose appropriate adjustments after September 2023.

Regarding the price of medical services, Deputy Minister of Health Le Duc Luan reported that since July 1, 2023, the basic salary will increase so the price of medical services will be adjusted. The Ministry of Health is also collecting opinions on the draft Circular stipulating the price of medical examination and treatment services on request, in which, the Ministry proposes prices suitable to roadmap and social ground, and at the same time ensures revenue for public health facilities, improve the living standards for doctors.

Source: VNExpress

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