Vietnam: Inflation comes in at highest level since August 2021 in March
Consumer prices increased 0.70% in March over the previous month, a smaller increase than the 1.00% increase seen in February. The softer rise was largely driven by falling prices for food.
Inflation rose to 2.4% in March, above February’s 1.4%. March’s reading was the highest inflation rate since August 2021. Annual average inflation rose to 2.2% in March (February: 2.1%).
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 boost inflation 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 well below the government’s 4.0% target in 2022.