Vietnam forecast Tuesday that annual consumer price inflation in July would accelerate to 8.39 percent due to higher costs of food, housing and medicine, up from 7.8 percent in June. Consumers expect outbreaks of pig diseases and bird flu will lead to a surge in food prices in the coming months.
The rise in the consumer price index (CPI) this month is way above the government's initial target to keep annual inflation this year at less than 7 percent.
The Finance Ministry recently revised up the country's 2007 inflation forecast to 7.5 percent to 8.2 percent, after prices in May and June rose beyond the annual target level.
The General Statistics Office released preliminary inflation figures showing food prices in July would be 15.03 percent higher than last July, up from a rise last month of 14.86 percent.
Food prices account for 42.8 percent of the price basket Vietnam uses to calculate inflation. Vietnam's inflation data is not seasonally adjusted.
Vietnam has been confronting a pig disease involving a bacteria that has infected 22 people in northern provinces. Two died during the first half of this year, doctors said.
People infected by the bacteria suffer from rapid internal haemorrhage and high fever after they eat pork from a sick pig or inhale the air near the sick swine.
The Agriculture Ministry said thousands of pigs have been infected by a virus in two central provinces and Da Nang city, and bird flu returned to ducks in a third central province.
The statistics office forecast prices of medicine and health care this month would rise 5.04 percent from last July, higher than the price growth last month of 4.64 percent.
The accumulated CPI growth this month is estimated at 6.19 percent since last December, the statistics office said.
The World Bank earlier this year forecast Vietnam's consumer prices for 2007 would be 6.5 percent higher than 2006 while the International Monetary Fund estimated a year-end inflation rate of 7.1 percent.
Source: Thanh Nien
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