Vietnamese inflation at seven-month low

Vietnamese inflation slowed to the weakest pace in seven months in April, official data showed on Wednesday, in the latest sign that the communist-run economy is losing steam.

Consumer prices rose 6.61 percent year-on-year in April, the Government Statistics Office said, slightly less than the 6.64 percent increase reported in March.

Economists say the slowdown in inflation is the result of past monetary policy tightening as well as cooling domestic consumer demand.

In 2011, Vietnam repeatedly raised interest rates to prevent the economy from overheating and to rein in double-digit inflation, but with the economy weakening the authorities last year resumed stimulus efforts.

Vietnam cut interest rates in March for the seventh time in little more than a year, in a bid to spur bank lending and boost consumption after economic growth fell to a 13-year low of 5.03 percent in 2012.

"The risk of another cut remains" if inflation continues to fall and the economy shows no sign of improvement, ANZ bank said in a research note released on Wednesday.

But lower official borrowing costs alone will not solve the problem of tight credit as the banking system needs to be restructured and non-performing loans tackled, it added.

ANZ said it expected Vietnam's inflation to average between six and eight percent this year, which is also the government's target.

In the first quarter of the year, the country's Gross Domestic Product (GDP) grew by 4.89 percent from a year earlier with authorities warning of an "extremely challenging" outlook.

Editor’s note:Yahoo Philippines encourages responsible comments that add dimension to the discussion. No bashing or hate speech, please. You can express your opinion without slamming others or making derogatory remarks.

  • The other side of Palawan Ellen Tordesillas, Contributor - The Inbox
    The other side of Palawan

    By Ellen T. Tordesillas Mention Palawan and what comes to mind are  Underground River and El Nido in the northern side of this richly-blessed province from its capital, Puerto Princesa. Three  weeks ago, we went to the southern side- in … Continue reading → …

  • What can void a new car warranty? James Deakin - Wheel Power
    What can void a new car warranty?

    "I was denied warranty once for changing my horn!" One very annoyed reader wrote. "I was told that placing a backup camera will void my warranty" said another. The others are best left in my private inbox as Yahoo! have a swear jar in the office that I do not feel like donating this week's pay to. Continue reading → …

  • Docu exposes destruction of PH marine resources VERA Files - The Inbox
    Docu exposes destruction of PH marine resources

    By Kiersnerr Gerwin Tacadena, VERA Files "Gutom (hunger)," Sen. Loren Legarda said is what’s in store for the Filipino people if destruction of the country's marine resources is not stopped. Legarda, chair of the Senate committee on Environment and Natural … Continue reading → …

Poll Choice Options