Customers shop at a supermarket in HCM City. Standard Chartered Bank forecasts inflation may rise again to 3.2 per cent year-on-year from 3.0 per cent year-on-year in August. — Photo baotintuc.vn

Standard Chartered Bank forecasts Việt Nam’s Q3 GDP growth to pick up to 5.1 per cent year-on-year (from 4.1 per cent in the second quarter). A rebound is expected in the second half of the year, after early signs of recovery in the second quarter.

The bank's 2023 GDP growth forecast remains at 5.4 per cent.

This information was released in its recent global research report titled “Việt Nam Macro: Q3 GDP to show ongoing recovery”.

According to the international bank, September data is likely to show a slight improvement over August, supported by retail sales. The bank expects September retail sales growth to stay robust at 8.2 per cent year-on-year, exports are predicted to fall 6.2 per cent year-on-year, imports to fall 7.0 per cent, and industrial production growth to pick up to 3.2 per cent. The trade surplus may narrow to US$1.3 billion.

Inflation may rise again to 3.2 per cent year-on-year from 3.0 per cent year-on-year in August. Education, housing, and food prices have driven inflation recently, while transport inflation has eased. Việt Nam received close to 7.8 million foreign visitors in the first 8 months of 2023, close to the full-year target of 8 million. However, the recovery remains tentative – trade is still contracting, manufacturing might remain lacklustre for some time, and FDI recovery prospects are unclear.

Tim Leelahaphan, Economist for Thailand and Việt Nam at Standard Chartered Bank, said: “While easing price pressures should allow policymakers to focus on growth, renewed concerns about an inflation rebound in the second half of the year could deter such a move. With the economic recovery starting to gain momentum, there should be less need for monetary policy support.” — VNS