Regarding retail sales growth, the bank projected that it will continue to improve strongly at 30.2 percent in July 2022 compared to the same period last year, while it increased to 27.3 percent in June 2022.
Standard Chartered economists also forecast that the State Bank of Vietnam will keep the policy rate on hold at 4 percent in 2022 to support businesses and the growth of the economy despite growing inflation.
Exports, imports and industrial production are forecast to increase by 22.2 percent, 20 percent, and 15 percent respectively in July 2022 compared to 20 percent, 16.3 percent, and 11.5 percent in June 2022. Vietnam is expected to record a trade deficit this month.
Tim Leelahaphan, an economist in charge of Thailand and Vietnam at Standard Chartered Bank, said that inflation is expected to rise to 3.6 percent in July in comparison with 3.4 percent in June – the fastest rate in the past two years, mainly due to supply pressures, while the pressure from the demand side is also gradually increasing. At the moment, inflation is still under control.
Recently, thanks to tax adjustment measures, gasoline prices in Vietnam have continuously decreased about 20 percent since the beginning of July 2022. The Government has also proposed to reduce the import tax on gasoline from 20 percent to 10 percent for the National Assembly’s consideration at the next session. However, prices of items, especially food and fuel, are likely to increase in the final months of 2022 and into 2023.