Inflation is currently being supported by three factors: the price of food, the government’s management of pricing, and monetary policies. However, the inflation rate may not remain at its current low level due to many factors. Analysts have predicted that if global oil prices remain at $100 a barrel, inflation may reach 3.5 per cent, but if the price reaches $120 a barrel, the rate will breach the 4 per cent limit.

Gasoline prices have increased six times over the past two months and are expected to hit a record VND30,000 ($1.3) per liter. This not only has a negative impact on inflation but also affects production and business activities and erodes people’s incomes. Analysts have said that if the world oil price rises to 150 USD a barrel and if the domestic gasoline price does not stabilize, then inflation will certainly increase to 4.5-5 per cent.