Việt Nam consumer strength to power through global headwinds

Việt Nam consumer strength to power through global headwinds

In its 'Vietnam 2026 Consumer Outlook,' BMI forecast that real household spending will expand 7.2 per cent year-on-year to reach VNĐ3,952 trillion (US$152 billion) at constant 2010 prices.

People dine at a shopping mall in Hà Nội. BMI said consumer purchasing power is set to rise, driven by stable inflation and a tight labour market supporting real wage growth. — VNS Photo Mai Hương

Việt Nam’s consumer spending is expected to remain strong in 2026, buoyed by rising household incomes, robust tourism and stable inflation, even as global trade headwinds threaten to slow overall economic growth, according to a new report from BMI, a Fitch Solutions company.

In its Vietnam 2026 Consumer Outlook, BMI forecast that real household spending will expand 7.2 per cent year-on-year to reach VNĐ3.95 quadrillion (US$152 billion) at constant 2010 prices. That marks a sharp recovery from pre-pandemic levels of VNĐ2.77 quadrillion in 2019 and aligns with the company’s projection for Việt Nam’s GDP growth of 7.2 per cent next year.

“While global trade headwinds create downside risks to economic growth, a thriving tourism market will help shield consumers from export challenges,” BMI said, noting that “consumer purchasing power will expand, supported by stable inflation and a still-tight labour market facilitating real wage growth.”

The report expects inflation to average 3.5 per cent in 2026, unchanged from 2025, remaining within the Government’s 3–5 per cent target. Meanwhile, the unemployment rate is forecast to hold steady at 2.1 per cent, one of the lowest in nearly six years.

“A tightening labour market will improve workers’ wage prospects and support consumer spending,” BMI added.

Retail activity has continued to strengthen through 2025. As of September, nominal retail sales were nearly 60 per cent higher than pre-pandemic levels, while real retail sales stood 30 per cent above 2019, according to data cited from the National Statistics Office under the Ministry of Finance.

People dine at a shopping mall in Hà Nội. BMI said consumer purchasing power is set to rise, driven by stable inflation and a tight labour market supporting real wage growth. — VNS Photo Mai Hương

The pace of growth has remained steady, with nominal sales up 10.4 per cent year-on-year and real sales up 6.9 per cent on a six-month moving average basis.

However, BMI warned that imported inflation will remain a major concern for Việt Nam in 2026 as the đồng weakens. It forecast the Vietnamese currency to depreciate by around 5.5 per cent next year, sliding from an average of VNĐ25,300 per US dollar in 2025 to about VNĐ26,700.

BMI added that the weaker currency could push up the cost of imported goods and production inputs, thereby adding pressure on domestic prices and slightly eroding household purchasing power.

“Currency depreciation also creates upside risks to inflation, which may lead the State Bank of Vietnam to curb its credit-boosting policies,” the report said.

Vietnamese households are still benefiting from low borrowing costs and expanding credit. Consumer lending has grown tenfold over the past decade, reaching around $150 billion by the end of 2022, equivalent to 40 per cent of GDP, according to BMI’s data.

Despite global uncertainties – from escalating trade barriers and geopolitical tensions to imported inflation pressures – BMI said Việt Nam’s domestic demand would remain resilient.

“The improving outlook means consumers will expand spending, allocating a greater portion of incomes to discretionary purchases,” it concluded.

Bizhub