Vietnam: Strong growth complicates inflation fight – DBS
DBS Group Research anticipates Vietnam’s October 2026 exports and retail sales to stay robust, while headline inflation hovers around 5%, above the 4.5% target. Strong electronics shipments, firm household spending and tourism underpin activity, but elevated transport, energy, food and material costs pose a policy challenge as authorities pursue at least 10% economic growth.
DBS Group Research anticipates Vietnam's exports and retail sales to remain robust in October 2026, with exports growing by 42.0% year-over-year and retail sales surging by 14.0% year-to-date. However, headline inflation is projected to stay elevated at around 5.0% year-over-year, surpassing the central bank's target of 4.5%. The robust electronics and machinery shipments, driven by favorable technology trends and artificial intelligence-related demand, continue to support exports.
Retail sales are buoyed by strong household spending, fueled by favorable labor market conditions and sustained tourism growth. Inflation has remained high, primarily due to price pressures in transport, energy, food, and materials, creating challenges for policymakers aiming for a 10% economic growth target this year.
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