Vietnam sees inflation at 22% in July

Vietnam's inflation rate, already one of the world's highest, accelerated for the 11th straight month in July, according to official estimates released Saturday. The consumer price index is expected to rise 22 percent this month compared with July last year, the General Statistics Office (GSO) said, as food costs soar. Inflation was reported at 20.82 percent year-on-year in June. Vietnam, long focused on economic growth, has shifted its efforts towards stabilising an economy facing a slew of challenges including rising inflation, a struggling currency and trade deficit. CPI began to accelerate in September 2010 and prices have continued to rise, although inflation is still below a recent peak of 28.3 percent seen in August 2008, and far from the triple-digit figures seen in the 1980s. Food prices, which climbed 23.8 percent year-on-year in the first seven months of the year, jumped 32.6 percent this month compared to July 2010, according to the GSO figures. "The risk of high inflation, an unstable macro-economy and how to ensure social security have become huge challenges for the our economy in 2011," Deputy Prime Minister Nguyen Sinh Hung told a national assembly meeting on Thursday. He added the government would be "patient but determined" in curbing inflation so that the year-end figure would be between 15 and 17 percent. In May the United Nations said the communist country had one of the five highest inflation rates in the world. Vietnam's efforts to bring stability to its economy have included raising key interest rates, vowing to cut state spending by 10 percent, and ordering that growth in credit, or loans, stays below 20 percent. The government is also trying to control the gold trade and reduce the prevalence of dollars in the economy. Vietnam's economic growth eased slightly to 5.6 percent year-on-year in the first half of 2011, a little below the country's year end target of around 6 percent.