Inflation likely to rise in Vietnam in near future: Standard Chartered

This would mark the seventh consecutive month of inflation.

However, economists at the bank anticipate the recent upward reversal since December to have continued in February; any moderation would have been only temporary.

Demand-driven factors may contribute to further inflationary pressure in the near future, Vietnamese media outlets reported citing a latest macroeconomic update about the country from bank.

The Vietnamese government has raised its 2025 growth target to at least 8 per cent from 6.5-7 per cent, with a higher inflation expectation of 4.5-5 per cent to create room for monetary policy flexibility.

The stronger growth outlook could help sustain low interest rates in the short term. However, Standard Chartered expects the State Bank of Vietnam to raise interest rates by 50 bps in the second quarter this year in response to rising inflation.

Retail sales growth is likely to have eased to 8.2 per cent YoY in February—down from 9.5 per cent in January, the economists forecast.

Export growth, meanwhile, might have risen to 23.2 per cent YoY, supported by a low base and continued improvements in electronics exports. Imports and industrial production likely grew by 24 per cent and 6.2 per cent YoY respectively.

However, Vietnam’s monthly trade surplus might have narrowed to $1.5 billion—down from $3 billion.

ALCHEMPro News Desk (DS)