Vietnam’s July consumer price index (CPI) dropped 0.29% against June, the second drop in a row this year.

Vietnam’s CPI down for two consecutive months this year

The country’s July CPI rose 2.22% from December 2011 and 5.35% year on year.

The decline this month remained unsurprising because of the recent falls in CPI registered in major cities compared to June, including Hanoi with 0.29%, HCM City 0.57% and Danang 0.21%.

In July, food, foodstuffs and catering services saw a fall of 0.47% from June due to abundant supply and concern about poultry diseases nationwide. The housing and construction material group dropped 0.93%, posts and telecommunications declined 0.08% and transport fell 2.71% due to successive drop of petroleum prices so far this year.

The recent sudden petroleum price hike was not included into factors for calculating CPI in July and it is expected to affect August and September’s CPI.

The impact of power prices has not yet affected CPI this month but it is expected to have an influence on future months.

Medicine and health services saw a rise of 3.36% against June; meanwhile the other groups grew between 0.22% and 0.51%. This was attributed to the Ministry of Health’s recent circular allowing for a 5 to 20 fold increase in health services.

Gold prices fell 0.31% against last month and 7.8% compared to December 2011. The US dollar price index slipped 0.05% and 0.85% from December 2011 respectively.

Vietnam targets to control CPI at 8-9% in 2012.