Despite the expected rise in Vietnam’s inflation rate this year, the country sees zero inflation until around the period approaching Tet. According to the General Statistics Office of Vietnam, Consumer Price Index reflects a flat growth from the previous month (+0.02% month-on-month). From 0.6% in December 2015, inflation ticked up to 0.8% in January 2016.

January’s price hike reflected increases in 9 of the 11 components of the index, including food and drinks (up by 0.94%), housing (up by 2.36%) and household appliances (up by 1.51%). Education reported the biggest rise.

From the same report, three rollbacks in gasoline retail price during the previous month reduced fuel prices by 6.44 percent month-on-month. Post and telecom are among those seen to fall, though by a marginal 0.06 percent. A moderate level of inflation characterizes a good economy, but will have negative impact on Vietnamese consumers if inflation rate rise higher than expected, as it will increase in their cost of living. Vietnam's inflation was at a record low of 0.63 percent in 2015, and the government is bent on increasing efforts to stick to its economic growth targets. Though recently reported inflation rate was the highest in six months, figures still hovered around historically-low levels. Keeping inflation under control have been among the main focus of the State Bank of Vietnam's (SBV) policymaking after prices soared 23 percent in 2008.


Inflation is forecasted to average 2.6% in 2016, and will accelerate to 4.3% in 2017.