Vietnam’s inflation accelerated to the highest level since May, driven by faster-than-targeted credit expansion, quicker economic growth and higher oil prices.
Consumer prices increased 4.35 percent in November from a year earlier after gaining 2.99 percent in October, according to figures from the General Statistics Office in Hanoi. On a monthly basis, prices rose 0.55 percent in November from October.
Inflation may accelerate to 6 percent by the end of the year, Deputy Prime Minister Nguyen Sinh Hung said last week. Credit growth in the 10 months through October reached 33 percent, exceeding the government’s 30 percent full-year target.
Higher commodity prices and “healthy” wage growth, according to Capital Economics Ltd., are also driving inflation.
“There are risks of inflation picking up,” Hung said in a Nov. 18 interview in Hanoi. “Since we wanted to boost economic growth, we injected a large volume of funds to businesses.”
The government also expects inflation of about 6 percent in 2010, Hung said, calling it an “acceptable and reasonable” increase given Vietnam’s economic growth.