Publication: Vietnam Macro Monitoring, May 2024
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2024-07-09
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2024-07-09
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Industrial production showed a significant increase, with the Index of Industrial Production (IIP) growing by 2.6 percent month-on-month (m/m) and 8.9 percent year-on-year (y/y), attributed to improved exports, particularly in manufacturing sectors. Retail sales experienced a modest recovery, growth rate indicated that consumer demand remains relatively weak. Both exports and imports experienced a surge, with exports and imports growing. The y/y growth rates were also substantial, suggesting increased demand from trade partners. Foreign Direct Investment (FDI) commitments and disbursements were solid, with the majority of FDI flowing into manufacturing and real estate sectors. Inflation rates remained stable, with the Consumer Price Index (CPI) inflation at 4.4 percent y/y and core inflation slightly moderating. The Vietnamese Dong (VND) continued to face depreciation pressure against the US Dollar (USD), and the interbank interest rates reflected a tightening of liquidity by the State Bank of Vietnam (SBV). Public revenue collection improved, but public expenditures and investment disbursements showed a slower pace. The government and SBV proposed measures to support the economy, including extending VAT reduction, reducing lending interest rates, and advancing the implementation of revised real estate laws. The report also notes that while there is a recovery in external demand, domestic demand and consumption show mixed signs. The authorities' measures aim to support the economy, but there are concerns about the impact of a strong US dollar and interest rate reductions on the exchange rate. The recommendation is to continue supporting aggregate demand through capital expenditures.
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“World Bank. 2024. Vietnam Macro Monitoring, May 2024. © World Bank. http://hdl.handle.net/10986/41841 License: CC BY-NC 3.0 IGO.”
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