The Viet Nam's General Statistics Office reported on August 24 that the national consumer price index (CPI), the main gauge of inflation, has recorded a seven-month lowest increase since February this year and the lowest level on a monthly basis over the past 10 years. — Photo phunuonline.com.vn

HA NOI (Biz Hub) – The Viet Nam's General Statistics Office reported on August 24 that the national consumer price index (CPI), the main gauge of inflation, has recorded a seven-month lowest increase since February this year and the lowest level on a monthly basis over the past 10 years.

According to the office's report, August's CPI rose slightly by 0.1 per cent from July, compared with a 0.13 per cent increase in July, 0.46 per cent in June and 0.54 per cent in May.

The third straight monthly decline in the CPI growth rate was driven by a fall in prices of nearly half of the items in the goods and services basket used to calculate CPI, deputy head of the office's Price Statistics Department Do Thi Ngoc said yesterday.   

Five among 11 groups of goods and services of the basket saw a price drop including restaurant and catering services (0.14 per cent); transport service (1.97 per cent); culture, entertainment and tourism (0.12 per cent); post and telecommunication services (0.03 per cent); and housing and building materials (0.02 per cent).

Ngoc attributed the slide in the price of restaurant and catering services to the abundant supply of food and foodstuffs that saw prices drop 0.35 per cent and 0.19 per cent, respectively.

The price of transport services was dragged down by the cut in petrol prices which happened in late July and early August, followed by decreases in bus, coach and ship fares.

Additionally, the automobile and motorbike market seemed to stagnate in August as the month coincides with the seventh lunar month, traditionally called the Ghost Month, that reduced prices of vehicles by 0.12 per cent, Ngoc added.

Speaking about the reason that led to CPI's marginal increase, Ngoc said that the major contribution was from the costlier health care services following a joint decision of ministries of health and finance.

Accordingly, medicine and healthcare services prices this August post the sharpest monthly hike, 6.18 per cent, compared to five other goods and services categories that share the same upward trend.

In addition, nine provinces and cities also upped tuition fees as stipulated in a Government decree last year. Higher demand for educational tools like textbooks, notebooks and pens to prepare for the new school year also boosted education prices, she added.

In August, gold prices rose by 1.72 per cent from last month while the VND/USD exchange rate was relatively stable, with one US dollar exchanged for VND22,330.

Compared with the same period last year, the August CPI increased by 2.57 per cent. The eight-month CPI climbed 1.91 per cent year on year.

The GSO said core inflation (CPI excluding food items; energy products and commodities under State management including medical and educational services) this month inched up 0.09 per cent from July and 1.83 per cent from a year before. The eight-month core inflation climbed 1.81 per cent from the same period of 2015.

The almost similar eight-month headline inflation (1.91 per cent) and core inflation (1.81 per cent) compared to the same period last year proved that the current monetary policy is effective, helping to stabilise the macro-economy, the office noted.

The GSO forecasts September will register a faster CPI growth rate than that of August because of higher educational services and petrol prices.

August CPI in the country's two biggest cities – Ha Noi and HCM City – marginally fell by 0.17 per cent and 0.2 per cent, respectively, from the previous month, the localities' statistics office reported on Wednesday. – VNS