Stagnant production likely to push CPI down further

Friday, Apr 18, 2014 08:00

Customers shop for frozen foods at Ocean Supermarket in Ha Noi. — VNS Photo Truong Vi
HA NOI (Biz Hub) — The consumer price index (CPI) in April may dip further on the back of low purchasing power, noted the Price Management Department under the Ministry of Finance.

However, the decline will happen at a slower pace as compared to that in March.

The department has forecast that certain price pressures were in a state of stagnation. Epidemics that have affected livestock and poultry, for instance, are not under control in the central region, highland, and southern provinces. Agribusiness and production are therefore still stagnant.

The prices of some essentials and utility services are expected to stay unchanged or decrease. The prices of diesel, mazut, oil, and gas have already been lowered in the end of March and early April.

The country's CPI in March dropped 0.44 per cent against the previous month, the lowest level recorded during the past decade. The prices of food commodities and products posted the steepest fall of 0.96 per cent this month. Housing and construction materials, including rent, electricity, water, fuel, and construction supplies ranked second with a decline of 0.74 per cent.

The CPI's slide during March was attributed to a sharp decline in consumption demand after the country's most important holiday of the Lunar New Year in February. The key reasons for the decline were decreased spending by the local consumers due to economic difficulties and stagnant production. However, the CPI in March still rose 0.8 per cent over December 2013. — VNS

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