Vietnam: Inflation comes in at highest level since August 2021 in April
Consumer prices increased 0.18% in April over the previous month, which was below March’s 0.70% rise. April’s result marked the lowest reading since December 2021. Looking at the details of the release, the prices for food decreased at a softer pace in April compared to March, while prices for transportation dropped after growing in the previous month. Meanwhile, education prices increased. Moreover, prices for health grew at a more subdued pace.
Inflation ticked up to 2.6% in April, following March’s 2.4%. April’s result was the highest inflation rate since August 2021. Annual average inflation remained at March’s 2.2% in April.
The current upward inflationary trend is likely to continue throughout the year, as private consumption and investment accelerate. Moreover, the rising prices of key commodities on global markets—especially oil and agricultural products—will drive prices up as well. Nevertheless, forecasts for interest rate hikes by Vietnam’s Central Bank and the anticipated slight appreciation of the dong should offset this somewhat, and our panelists forecast inflation to average below the government’s 4.0% target in 2022.