As of 2008, the consumer price index (CPI) will no longer be calculated on a monthly basis, but on a quarterly average or the yearly average basis, said Head of the General Statistics Office Le Manh Hung.
According to Mr Hung, the current method to calculate CPI has been used since 1985. At that time, inflation was very high and managers had to calculate CPI on a monthly basis to have timely reactions.
However, this way of calculation, according to Mr Hung, is not suitable to international practice and sometimes causes difficulties for management. He said that in many cases, if CPI is defined on a monthly basis, it would be difficult to evaluate the impacts of factors to prices.
For example, if petrol price increases in mid-May, CPI of May is announced in mid-June. This period of time is too short to assess the impacts of petrol prices on other goods. In addition, there are many factors that do not immediately show their impacts, but they need time. As a result, calculating CPI on a quarterly basis would be more precise.
To make acquaintance with this change, as of June 2007, the General Statistics Office has introduced the average CPI of the first half of 2007 to compare with that of the first half of 2006. Specifically, compared to the first half of last year, the average CPI of the same period of time increased by 7%.
Source: VNE
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