Inflation to be contained within target this year: central bank

There is strong pressure from rising global inflation caused especially by the surging prices of oil and manufacturing inputs due to supply chain disruptions caused by Covid-19 and the ongoing war in Ukraine, Pham Chi Quang, deputy head of the State Bank of Vietnam’s currency policy department, said at a recent press briefing.

“However, Vietnam is totally capable of keeping the price rise to 4 percent, and the country has enough currency policy room to stabilize interest and exchange rates to prevent import of inflation.”

While other countries have seen their currencies lose quickly, the dong has only been weakened by around 2 percent this year, he said.

Lender HSBC last week cut its inflation forecast for Vietnam from 3.7 percent to 3.5 percent, thanks to stable food supply and weaker than expected impacts of fuel costs.

Inflation was 2.25 percent in the first five months against 1.29 percent in the same period last year.

Standard Chartered expects full-year inflation to be 4.2 percent in 2022 and 5.5 percent in 2023.

Prices rose by 1.8 percent last year, the least in six years.