Low CPI increase raises worries
Low CPI increase raises worries
It’s foreseeable that the consumer price index (CPI) only increases very slightly in April, though the General Statistics Office will only release the CPI report later this month. Nearly all the sectors of the national economy have been immovable.
The petrol price increases, which have led to the transportation service fee increases, plus the healthcare service fee increases are still not enough to offset the decreases in the food and foodstuff prices.
According to the General Statistics Office, petroleum products account for 8.87 percent of the basket of goods and services for calculating CPI. In previous years, any petroleum price increases would lead to the price increases of other goods and services.
After the petrol price was raised on March 28, the Ministry of Industry and Trade said that the price increase would make the CPI increase additionally by 0.127 percent, while the indirect impacts remain unpredictable. Some taxi and cargo transportation firms have also announced the 7-8 percent service fees.
The slight decrease of the petroleum prices on April 28 has helped weaken the influences of the petroleum price hike to the CPI increase. However, petroleum price and transportation service fee increases alone would certainly push the prices up.
Analysts have pointed out that the healthcare service fee would also push the CPI up. However, in April, the healthcare service fees were raised only in four cities and provinces – Hai Phong, Nam Dinh, Binh Thuan and Tay Ninh. The service fee only accounts for a small portion in the basket of goods and services considered for calculating CPI. Therefore, its impacts on the CPI would be weak.
It is the food and meal services which are believed to be the main reason behind the slowdown in the CPI increase. The products and services account for 39.93 percent of the basket of goods and services (food 8.18 percent, foodstuff 24.35 percent and meal services 7.4 percent).
In the two big cities of Hanoi and HCM City, the prices of the goods and services have decreased by one percent over the previous month.
The further decreases in the prices of food and meal services have been predicted by the taskforce on the domestic market management because of the hot weather, the demand decrease and the profuse supply.
Especially, with the stabilization of the goods prices in the world market, experts can see no big reason which may lead to the sharp CPI increase as previously warned when the petrol price was raised.
Commenting about the CPI increase slowdown, Dr. Vu Dinh Anh, a well-known price expert, said everything has been sitting without stirring because all the sectors of the national economy have been immovable.
Sharing the same negative view, Dr. Ngo Tri Long, also a well-known economist, said the CPI increase slowdown would be a worry than a joy.
While this is the good news to the consumers, who now can buy goods and services cheaply, this is the bad news for the domestic production.
“This reflects the gloomy picture of the national economy, in which the inventories are high, the laborers’ income decreases, the purchasing power decreases and the consumers’ confidence decreases,” Long said.
“The grey color of the picture about the national economy is the main reason that makes the CPI increase slow down,” Long said
vietnamnet
