Proactively forecast and carefully consider when to adjust prices

Transportation group prices decreased mainly due to the reduction in domestic gasoline and oil prices. Illustration photo: H.Dịu

Follow the prices operating scenario

According to the Ministry of Finance, prices of most goods remained stable in May due to abundant supply. However, prices of some items increased, such as pork due to the African swine fever outbreak in some localities affecting to the supply, and rice due to high export demand. Fuel prices were mixed, with LPG prices decreasing and gasoline and diesel prices adjusted in line with global market movements.

Overall, market prices in Vietnam were stable in the first five months of 2024, in line with the price management scenario set out by the Prime Minister's Steering Committee on Price Management.

At the report of Ministry of Planning and Investment, the Consumer Price Index (CPI) increased by 0.05% in May 2024 compared to the previous month and by 4.44% compared to the same period last year. The main reasons for the increase in CPI were the increase in pork prices due to supply shortages and the increase in electricity prices for domestic use due to hot weather.

In the group of goods and services with increasing price indexes, the housing and construction materials group increased mainly due to the increase in electricity prices for domestic use; the culture, entertainment and tourism group increased due to the high demand for tourism during the long holiday of April 30 - May 1; the beverage and tobacco group increased due to the hot and humid weather, leading to an increase in demand for soft drinks; the medicine and healthcare group increased mainly due to the hot weather, the number of cases of measles, chickenpox and hand, foot and mouth disease increased quickly, so people have a demand to buy immune-boosting drugs.

In the group of goods and services with decreasing price indexes, the education group decreased because some schools have adjusted their tuition fees downward after collecting them following the new government regulations. The transport group decreased mainly due to the decrease in gasoline and diesel prices in Vietnam due to the impact of price adjustments in the month. The Ministry of Finance said that it has been working closely with the Ministry of Industry and Trade to closely monitor the movements of world gasoline and diesel prices in order to manage domestic gasoline and diesel prices in line with market conditions. On that basis, after 20 rounds of adjustments to domestic gasoline and diesel prices since the beginning of the year, the prices of gasoline products have been reduced 9 times and increased 11 times; diesel (DO) and kerosene have been reduced 10 times and increased 10 times; and mazut 3.5 S (FO) has been reduced 7 times and increased 13 times.

Price management in Vietnam is on track to meet inflation targets

Thus, the above assessments show that the increase and decrease momentum of product and service groups still moves according to the rules, following market situations such as Tet holidays, hot weather... without impact mutations. According to experts, the price management work is still on track to meet the inflation control targets set by the National Assembly for 2024, with the remaining inflation margin each month compared to the previous month increasing from 0.39 to 0.6% in the remaining 7 months of 2024.

However, the adjustment of basic wages from July 1st and the pressure from food prices, gasoline and diesel prices, and exchange rates have raised concerns about price management and inflation control targets. The Ministry of Finance has affirmed that it will continue to closely monitor market prices, actively forecast, calculate and update inflation scenarios to advise competent authorities on building overall price management scenarios and implementing specific solutions.

At a meeting of the Government Standing Committee with ministries and sectors on solutions to stabilize the macro-economy, control inflation and promote economic growth on June 8, Prime Minister Pham Minh Chinh urged the ministries and sectors to resolutely implement solutions to stabilize market prices; ensure abundant supply of goods and avoid shortages; strengthen transparency and supervision of price declaration and price listing following regulations; and not to unreasonably increase prices of goods and services. The Prime Minister also noted that the adjustment of electricity and gasoline prices must be in sync and harmonious to avoid simultaneous price increases; and to carefully assess and consider the timing and level of adjustment of tuition fees and medical examination and treatment service prices when conditions are favorable and there is room for adjustment.