State Bank of Vietnam

Hanoi (VNA) – The State Bank of Vietnam on March 25 announced that it would keep
the prime rate unchanged at 8 percent for a fifth month, surprising experts who had
expected an increase as part of the Government’s efforts to reduce inflationary
pressures.

The decision came one day after the General Statistics Office released data
showing inflation had risen by 0.75 percent in one month in March and 9.46 percent
over the same period last year. The consumer price index increased by an
unexpectedly high 4.12 percent in the first quarter alone.

Vietnam’s inflation had reached “worryingly high” levels, as the Southeast
Asian region overall began to see resurgent price pressures amid the economic
recovery, HSBC Holdings Plc said in a report released on Wednesday. The report had
predicted that the inflationary pressures would force the central bank to add a
percentage point to the prime rate.

In response to concerns that inflation in 2010 might surpass the National
Assembly’s target of 7 percent, Minister of Finance Vu Van Ninh said that the
Government would implement measures to curb inflation while ensuring economic
growth, and that these measures would include consistent market pricing policies to
avoid irrational pricing.

Some stock investors cheered the central bank decision and expected a market
rally.-Enditem




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