Rising medication and healthcare costs drive up CPI by 0.31% in January 2024.

The Consumer Price Index (CPI) for January 2024 increased by 0.31% compared to the previous month, and increased by 3.37% compared to the same period in 2023. The core inflation rate for January 2024 rose by 2.72%...

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According to the data published by the General Statistics Office on January 29, 2024, the Vietnam Electricity Group adjusted the average retail electricity price and domestic rice price, following the increase in export rice price and the increase in healthcare service prices due to the implementation of the Circular 22/2023/TT-BYT by some localities, resulting in a 0.31% increase in the Consumer Price Index (CPI) in January 2024 compared to the previous month.

Out of the 0.31% increase in CPI in January 2024 compared to the previous month, there were 9 groups of goods and services with an increased price index and 2 groups with a decreased price index.

Among the 9 groups of goods and services with an increased price index, the healthcare and medicine group had the highest increase with 1.02%, contributing to a 0.05 percentage point increase in the overall CPI. The price index of medicines increased by 0.09%; outpatient medical services increased by 0.89%; inpatient medical services increased by 1.67%.

The CPI increase/decrease rate in January 2024 compared to the previous month.
Source: General Statistics Office.

The General Statistics Office stated that the main reason for the increase was the implementation of the new healthcare service prices according to Circular 22/2023/TT-BYT issued by the Ministry of Health on November 17, 2023, which standardized the price of healthcare services for medical insurance between hospitals of the same level nationwide, and provided guidelines for the application of prices and payment of medical examination and treatment costs in certain cases.

Next, the housing and construction materials group increased by 0.56%, contributing to a 0.11 percentage point increase in the overall CPI. This group increased due to a 1.29% increase in household electricity prices compared to the previous month and an increased demand for electricity for heating during colder weather; maintenance material prices increased by 0.53% and housing repair service prices increased by 0.33%; gas prices increased by 1.69%.

The transportation group increased by 0.41%, pushing the overall CPI up by 0.04 percentage points. The increase in this group was caused by a 0.79% increase in gasoline prices; a 1.39% increase in diesel prices; a 3.64% increase in public transportation service prices; a 0.06% increase in auto parts prices; a 0.12% increase in motorcycle tire prices; a 0.47% increase in other bicycle parts prices; a 0.38% increase in vehicle maintenance services; and a 0.63% increase in car wash and pumping services due to increased labor costs and demand during the end of the year; bridge toll fees increased by 1.54%.

In addition, the beverages and tobacco group increased by 0.38% due to increased consumer demand and usage for gifting purposes during the upcoming Lunar New Year, resulting in a 0.54% increase in the price of beer and alcohol; a 0.32% increase in the price of tobacco; and a 0.06% increase in the price of non-alcoholic beverages.

The clothing, hats, and footwear group also saw a slight increase of 0.22% due to increased labor costs, material costs, and the demand for winter clothing and gifts during the upcoming Lunar New Year of the Rat.

Among the 2 groups of goods and services with a decreased price index, the education group decreased by 0.12%, of which education services decreased by 0.15%. The main reason for the decrease was the issuance of Resolution 97/2023/NĐ-CP by the Government on December 31, 2023, amending and supplementing certain provisions of Decree 81/2021/NĐ-CP dated August 27, 2021, which required the stability of tuition fees for the 2023-2024 school year at the same level as the tuition fees for the 2021-2022 school year for public preschool and public primary and secondary education. Therefore, some localities have adjusted the tuition fees after collecting them according to Decree 81/2021/NĐ-CP.

The statistics also showed that the core inflation in January 2024 increased by 0.21% compared to the previous month and increased by 2.72% compared to the same period last year.

The core inflation increased by 2.72% compared to the same period last year, lower than the average overall CPI increase (3.37%), mainly due to the impact of healthcare and education service prices on the CPI, but these items are excluded from the calculation of core inflation.

The domestic gold price fluctuated in the opposite direction to the global gold price. As of January 25, 2024, the average world gold price was $2,014.85/ounce, a decrease of 1.23% compared to December 2023 due to the strengthening of the US dollar and the unpredictable timing of interest rate cuts by the US Federal Reserve (FED).

In Vietnam, the demand for purchasing gold before the Lunar New Year increased, causing the gold price index in January 2024 to increase by 2.55% compared to December 2023 and increase by 15.43% compared to the same period last year.

In Vietnam, the average exchange rate of the US dollar in the free market remained around 24,555 VND/USD. The US dollar index in January 2024 increased by 0.52% compared to December 2023 and increased by 3.69% compared to the same period last year.

SOURCEvneconomy
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