HCMC CPI rise 1.32 pct in Feb, 12-year 2nd lowest

The groups of goods with high demand for the Tet (Lunar New Year) holiday, including food and catering services, beverages and tobacco, housing, fuel and construction materials, saw the strongest rise of over 1 per cent each.

Among them, food and catering services posted the strongest rise.

The increase in electricity costs in December 2011 and cooking gas prices recently have contributed directly to the rise of fuel groups and related groups of commodities.

However, the price increases of some groups of essential goods for Tet slowed down due to falling demand.

The purchasing power of the city in February declined since the demand had surged in the pre-Tet period, said HCMC Statistics Office.

Specifically, total retail sales this month are estimated at VND40.7 trillion ($1.95 billion), down 6.3 per cent over the previous month, the month of the Tet.

However, this is the 4th consecutive month the CPI in the southern economic hub continued its upward trend.

Hanoi Statistical Office has also announced the CPI rise of 1.45 per cent in February.

Major factors causing this increase included group housing, electricity, water, fuel and building materials. This group CPI increased 2.79 per cent compared with January.

The next group includes food and food services (up 2.32 per cent), and catering services (up 1.81 per cent).

February CPI likely to accelerate 1.5 per cent

Vietnam's consumer price index (CPI) in February 2012 had been forecast to accelerate by 1.5 per cent over the previous month based on Leontief-ARIMA models, according to online newspaper NDHMoney.

The forecast said the main reason affecting Vietnam's February CPI rise is the supply- demand relationship. Production is stagnant, while consumption demand has increased to the highest level of the year.

The statistics from the General Statistical Office of Vietnam indicated that the industrial production index for January 2012 dropped by 12.9 per cent over the previous month, a year-on-year decrease of 2.4 per cent.

Meanwhile, the total retail sales of commodities and services for 2011, excluding the price-rise factor in the Tet months, climbed 4 per cent over the preceding year.

Prices of food and catering services are thought to be primarily responsible for the CPI upsurge, of which foodstuffs have seen the highest increase due to soaring prices of beef, pork, seafood, poultry and several vegetables largely consumed during Tet.

Also, prices of wine, beer, confectionery, fashion products and toys are on the rise.

In addition, the electricity price increase was allowed in 2011 rather than March 2012.

Its impacts on CPI now come as this product can be used first and paid for later. Also, the steep rise in the global price of cooking gas has hit the domestic price remarkably.