April Vietnam CPI reaches 20-year high

Vietnam’s consumer price index (CPI) in April soared 3.32 percent against last month, making it the highest month-on-month increase since 1991. The General Statistics Office report, released yesterday, said the rise exceeded that of the April 2008 high of 2.2 percent, which was blamed on the global economic crisis.
The inflation rate in the first four months of 2011 soared 9.64 percent higher than the yearly target of 7 percent.
The office director Nguyen Duc Thang attributed the April increase to the price hike of essential goods such as food, foodstuffs and petrol.
"Political uncertainties in North Africa and the Middle East, as well earthquakes and the nuclear crisis in Japan, have caused commodity prices to soar worldwide. Vietnam is not immune," he said.
He added that the biggest force behind the rise had been the petrol price hikes on February 24 and March 29, and the higher cost of power price since March.
Economists attributed that the uncertainties of foreign exchanges, although were slowing down, still bothered when it resulted to a high cost for domestic enterprises to import goods and materials.
All 11 commodities groups used to calculate the CPI saw an increase this month. Transport prices continued to rise in the second month, surging 6.04 per cent due to a hike in petrol price. Meanwhile the cost of food soared 5.61 per cent.
The cost of eating out and restaurant services rose 4.5 per cent, while foodstuffs rose 2.47 per cent.
Housing and construction materials (electricity, water, fuel and rent) saw the fourth biggest rise, climbing 4.38 per cent. Textile-garments and home utensils and equipment saw the slighter increase, rising 1.63 and 1.38 per cent, respectively.
Despite soaring inflation, the price of gold and the US dollar fell by 1.2 per cent and 1.61 per cent against the previous month. Neither were taken into account when calculating the CPI.
The CPI should not rise further after April if the State Bank was consistent to the tightened monetary policies, said Le Xuan Nghia, deputy chairman of the National Financial Supervision Council.
Nghia said new policies on monetary supply would come into effect in May. 

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