VINACHEM

Prices in Hanoi and Ho Chi Minh City rose at an even slower pace – at 0.49 and 0.24 percent, the lowest rate for February since 1976 -- according to figures released by the General Statistics Office.

Food and dining service prices saw the highest rise of 1.15 percent month-on-month, but just half the rise recorded in February last year, also a holiday month, Thoi bao Kinh te Saigon Online reported.

In the Tet month in 2011 they had risen by 3.65 percent month-on-month.

Prices of goods that are always in high demand during the holiday season, such as beverages, tobacco, and clothing, only changed slightly at 0.22-0.6 percent.

Transport prices rose by 0.66 percent from January and entertainment services by 0.61 percent.

Prices of housing and construction and fuel, two of the 11 items in the consumer price index basket, actually fell, dropping by 0.64 percent, and postage and telecom services by 0.02 percent.

The CPI rose in January by just 0.69 percent, the lowest in four years for a shopping month.

Economist Ngo Tri Long told the newspaper that while lower is good news, it is also a warning of low purchasing power and a likely rise in inventories.

The stagnant economy has cut people’s incomes and caused them to spend less, he said.

He said the figures reflect people’s low confidence in the economy, which seems to have bottomed out but not begun to recover yet.

The government needs to take more and effective measures to stimulate consumption and production, create jobs, and increase people’s income, he added.