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Inflation set to rise

by VTV408 July 2016 Last updated at 10:19 AM

VTV.vn - Agriculture has proved a drag on GDP growth, following the worst drought in three decades.

Vietnam’s ambitious GDP growth rate of 6.7% is unlikely to be reached due to the crippling effects of the heat, while inflation is predicted to rise.

After the first 6 months of 2016, inflation rose 2.35% compared to last December and nearly 5 times higher than the same period last year. At a recent seminar discussing Vietnam’s market performance, experts said inflation still lies within control, but could increase.

"The inflation rate may surpass the 5% level. I think it fall around 4.8 to 5.2%. Although Vietnam’s macro-economy has been stabilised, I think this won’t last for long. Government overspending is a factor that is fuelling inflation", said Ngo Tri Long - Economist.

"It depends on how the state will adjust medical expenditure. As far as I know, there remains a plan to raise medical charges, but its implementation hasn’t been announced yet", said Nguyen Duc Do - Economist.

Experts also agreed that without inflation being curbed until the end of the year, then economic growth will be negatively affected. The economic growth rate is forecast to reach 6 to 6.5%, but policymakers will also struggle to maintain inflation below 5%.

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