The General Statistics Office (GSO) reported a year-on-year increase of 4.35 percent in prices and 5.07 percent over December 2008, resulting in the CPI in the past 11 months jumping by 6.91 percent year on year.

The government’s statistics agency added that in November, 10 of the 11 main groups of commodities saw their CPI rise between 0.03 and 0.87 percent. Only the post and telecommunications sector saw a drop of 0.05 percent.

The processed food and restaurant services sector witnessed the biggest rise of 0.87 percent due to an increase in the price of food and foodstuffs by 2.22 percent and 0.62 percent, respectively.

Property and construction materials ranked second, with the prices up 0.75 percent, followed by commodities and other services sector by 0.54 percent.

The Deputy Head of the Commercial and Pricing Department under the GSO, Nguyen Duc Thang, explained that rice exporters had increased the amount of rice they were buying from farmers and this had fuelled the rise in food prices.

He also blamed the recent deadly storms and floods in the central region and the Central Highlands for the sharp rise in the price of food and foodstuffs.

The slight increase in petrol prices in November was another reason for the CPI going up, added Thang.

Market analysts have predicted a continued rise in the price of food and foodstuffs in the rest of the year as storms and floods and the spread of epidemics in several localities has had a knock on effect on the economy.

The prices of imports may also be affected by the stronger US dollar, they said.

December is always one of the busiest shopping months in Vietnam , and this will contribute to an increase in the CPI, say experts. They also eased domestic consumers’ concerns over price hikes by confirming that inflation would only fluctuate at around 7 percent for entire 2009.

November was marked by the chaos in the gold market with gold prices up 10.08 percent over October, the highest ever rate so far. This represents an increase of 48.72 percent against December last year and 15.73 percent year on year.

The value of the US dollar bounced back in November, increasing by 1.45 percent month on month after a drop of 0.35 percent in October.

As a result, the value of the US dollar in the last 11 months rose by 7.28 percent over December 2008 and, 9.04 percent year on year.

Source: VietNamNet/VNA