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CPI for March under pressure
The consumer price index (CPI) for March 2010 is predicted to rise above last March’s figure due to unfavourable factors, according to market management experts.
At a recent meeting in Hanoi, the experts attributed the increase to the government’s recent decisions to raise petrol and electricity prices, the growing trend of price hikes for imported materials, and the depreciation of the Vietnamese Dong against the US dollar. In addition, prices of commodities and services remain high after the Lunar New Year festival.
Nguyen Tien Thoa, head of the Price Management Department under the Ministry of Finance, said commodities, excluding imported materials and services, would cause the CPI to rise by 0.4 percent in March, with petrol and electricity accounting for 0.17 percent of the increase.
Nguyen Danh Trong, an official of the State Bank of Vietnam, said those commodities will not have a big impact on CPI, but expressed his concern that the increase in the prices of several essential commodities will psychologically drive up market prices.
Mr. Trong explained that Vietnam achieved a GDP growth rate of 5.3 percent in 2009 while keeping the CPI at 6.7 percent. If GDP grows 6.5 percent this year, the CPI will increase correspondingly.
To rein in a possible runaway CPI in March, Hoang Tho Xuan, a senior official of the Ministry of Industry and Trade, said it is imperative to control market prices, especially commodities that need to have their prices stabilised. He said appropriate measures should be employed to prevent opportunists from cornering the market. He noted that it remains difficult to oversee markets due to a lack of market management experts.
The experts pointed out lessons provided by Hanoi and Ho Chi Minh City that allocated huge amounts of money for businesses to store commodities during the Lunar New Year festival. As a result, the prices of essential commodities remained stable before and after the festival. The experts said the model should be applied the whole year round to nip in the bud any signs of price hikes.
They shared the view that the government should monitor supply and demand of essential commodities such as rice, petrol, fertilizer, cement, and steel, and intervene in the market if there are any signs of runaway inflation.
VOV
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