Prices of foodstuffs and petrol push up CPI in February

Friday, 2018-03-02 21:53:58
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Prices of foodstuffs and petrol push up CPI in February
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Month-on-month growth in the consumer price index for February has climbed to a five-year high, driven primarily by increases in the prices of foodstuffs and petrol.

Tran My Lan, country director for Lutosa Vietnam – part of the Lutosa Group, Belgium’s largest exporter of high-quality potato products – will meet this week with representatives of major importers in Vietnam to discuss plans to sell Lutosa’s products to them.

“In the first two months of 2018, our sales rose by at least 20% in Vietnam. It is expected that the rate will be higher in the coming months,” Lan told Nhan Dan online. “Demand for foreign potatoes in Vietnam is surging, particularly from enterprises, restaurants, and supermarkets, and especially during the Tet holiday. We are supplying the products for Vinmart, Aeon, Mega Market, and Fivimart.”

Lan said that over the past five months, the dong/euro exchange rate has appreciated from VND24,000 to VND29,000. Thus importers have had to increase the prices of potatoes by 5-7%.

Such a price hike is also reflected in the two-month consumer price index (CPI) of Vietnam. The General Statistics Office (GSO) last week reported that CPI for February ascended 0.73% against January, making it the highest month-on-month February climb since 2014.

One of the biggest drivers of the CPI climb is the strong hike in the price of foodstuffs in February due to high demand over the Lunar New Year.

Specifically, the price of the catering group – one of 11 groups of goods and services used to measure CPI – rose the highest, by 1.53% month-on-month, in which the prices of food and foodstuffs climbed 1.44 and 1.71%.

“The reason is that the public have boosted the purchase of food and foodstuffs for the Lunar New Year holiday,” said a GSO report on Vietnam’s two-month socio-economic situation released last week. “As well as this, local firms have also boosted their rice exports.”

According to the Vietnam Food Association, local firms exported 397,000 tonnes of rice worth $197 million in February. This has raised the total two-month exported rice volume to 889,000 tonnes worth $437 million – up 21% in volume and 39.6% in value, year-on-year.

The export price of rice sat at $486 per tonne, up 13.6% year-on-year.

The GSO also reported that in addition to the catering group’s price expansion, a 0.79% increase in the traffic group also contributed to February’s CPI ascension.

“This is due to a hike in the petrol price in January,” said the report. “The price of public transport services advanced 3.34% in February.”

According to the GSO, the prices of many other groups have also gone up month-on-month, such as drink and cigarette (up 0.75%), entertainment and tourism (up 0.72%), home appliance (up 0.27%), and garment and footwear (up 0.2%).

Khoi Nguyen