Illustrative image (Photo: Reuters) Hanoi (VNA) – Vietnam’s industrialproduction and retail sales slid down in October due to stalled demand athome and abroad, according to the Vietnam Macro Monitoring report released bythe World Bank in Hanoi on November 16.
Also due to weakening demand from major export markets,Vietnam’s export growth moderated to 4.8% annually, the lowest in the past 12months amid rising domestic inflation, tighteningglobal financial conditions and geopolitical instability in the world.
However, the registered foreign direct investment (FDI) capital reboundedthanks to inflows into production facilities in electricity, gas and watersupply sectors. FDI disbursement still maintained asolid growth.
Despite softening fuel prices, consumer price index (CPI)accelerated from 3.9% in September to 4.3% in October due to inflation of food thataccounted for 21.5% of the CPI basket.
Credit growth dropped to about 16.5% in Octoberyear-on-year due to tightening financial mobilisation conditions. The average overnight interbank interest rate increasedfrom 4.95% in September to a record 5.48 percent in October. To stabilisethe domestic currency, the State Bank of Vietnam raised twokey policy interest rates by 100 basis points.
Thereport showed by the end of October, the State budget recorded a surplus of 10.7 billion USD. The total bond issuance reached 34.9% of the annual plan, much less than 72.5% recorded in the same period last year.
Given the economy isnot fully recovered and growth in main export markets are expected to slow, the WB experts suggestedthat continued active fiscal policy tosupport the economy should be closely aligned with economic outcomes andcoordinated with monetary policy./.
