28/12/2023 15:19

Vietnam: What is CPI? Method to calculate domestic CPI index

Vietnam: What is CPI? Method to calculate domestic CPI index

I often read financial newspapers that mention the CPI index. What does the CPI index mean? Mr. Le Bao (Binh Duong, Vietnam).

Hello, Lawnet would like to answer as follows:

1. What is CPI?

According to the General Statistics Office, CPI is the acronym for Consumer Price Index, which means consumer price index. CPI is a relative indicator (expressed in %) that reflects the general trend and price fluctuation over time of goods and services consumed daily by people.

A representative list of goods and services includes major items and services, representing population consumption in a certain period, used for periodic surveys and price collection, and serving to calculate CPI.

2. What are the methods to calculate the domestic CPI index in Vietnam?

According to the General Statistics Office, the method of calculating domestic CPI is carried out as follows:

- The national CPI index is calculated by the weighted average method between the consumer price index of 06 economic regions and the corresponding weights.

- The CPI index of 06 economic regions is calculated by the weighted average method between the consumer price index of each province/centrally-run city in the region and the corresponding weight.

- The CPI of provinces/centrally-run cities is calculated by the weighted average method between the consumer price index of each group of goods and consumer services selected for investigation and the corresponding weight.

Thus, we can see that the CPI index is calculated from the results of consumer price surveys in each province/centrally run city.

Specifically, the CPI is calculated using the weighted average method between the price fluctuations of commodity groups with the corresponding weights.

3. Formula to calculate the CPI index

The consumer price index is calculated according to the weighted average Laspeyres formula with the following general form:

Calculation formula:

Trong đó:

: Is the consumer price index in the reporting period (t) compared to a fixed base period (0);

: Correspondingly, consumer prices in reporting period t and base period are fixed (0);

: Is the fixed base period weight (0);

: Correspondingly, pepper price and consumption quantity in the base period are fixed (0);

n: Is the item number.

4. What is the average CPI in the third quarter of 2023 in Vietnam?

According to the General Statistics Office's Price Market Overview in September, the third quarter, and the first 9 months of 2023,

The average CPI in the third quarter of 2023 will increase by 2.89% compared to the same period in 2022.

Factors increasing CPI in the third quarter of 2023 include:

– Rental housing prices in the third quarter of 2023 increased by 28.48% over the same period last year due to increased rental demand when entering the new school year.

– Food prices increased by 7.05%, of which rice prices increased by 6.99% according to export rice prices, causing the overall CPI to increase by 0.18 percentage points.

– Educational service prices increased by 6.15% due to some localities stopping tuition support for the 2023–2024 school year and implementing Decree 81/2021/ND-CP; The impact increased the overall CPI by 0.34 percentage points.

– The price of eating out at home increased by 3.94% over the same period last year due to increased consumer demand during the summer holidays.

– Beverage and cigarette prices increased by 3.05%, mainly due to increased raw material prices for beverage production and transportation costs.

– The price of housing maintenance materials in the third quarter of 2023 increased by 2.76% over the same period last year due to increased prices of stone and sand while sand mining supply was scarce, causing the overall CPI to increase by 0.06 percentage points.

Market overview and prices in September, Quarter III, and the 9 months of 2023: Download

5. How is the method of investigating the list of goods and services to calculate the CPI for the period 2023–2025 in Vietnam?

Pursuant to the Consumer Price Survey Plan for the period 2020-2025 attached to Decision 1134/QD-TCTK dated July 12, 2019 of the Director General of the General Statistics Office, the investigation method for the list of goods and services to calculate the CPI index in the period 2023-2025 is carried out as follows:

- Investigators in provinces and centrally run cities must directly go to investigation points to collect prices.

- Retail prices of consumer goods and services are investigated on smart electronic devices such as tablets and mobile phones.

- Each investigator is given a separate account to access the investigation software on smart electronic devices to download the list of items and the network of investigation points.

- Every month, enumerators use smart electronic devices to investigate the prices of goods and services at the investigation point.

- When conducting consumer price surveys, investigators must strictly comply with the following regulations:

- Investigate and collect prices at the right period, at the right investigation point, and at the right specified product;

- Check carefully to detect changes in goods quality and packaging volume (for example instant noodles, milk, MSG, soup powder, etc.), especially for goods that have many specific specifications, grades, and labels (for example, electronic goods, vehicles, garments, shoes, etc.).

- The Statistics Department must regularly inspect, review, and supervise the actual investigation work of investigators.

- For rented housing, detailed instructions are in Appendix 7, Consumer price survey plan for the Period 2020–2025, attached to Decision 1134/QD-TCTK.

Decision 1134/QD-TCTKDownload

Do Minh Hieu
32


Please Login to be able to download
Login
Register

  • Address: 17 Nguyen Gia Thieu, Vo Thi Sau Ward, District 3, Ho Chi Minh City
    Phone: (028) 7302 2286 (6 lines)
    E-mail: info@lawnet.vn
Parent company: THU VIEN PHAP LUAT Ltd
Editorial Director: Mr. Bui Tuong Vu - Tel. (028) 7302 2286
P.702A , Centre Point, 106 Nguyen Van Troi, Ward 8, Phu Nhuan District, HCM City;