RHB | Vietnam | Key Economic Activities Weakened In October, But Growth Remains On Track To Improve In The 4Q, 28 Oct 2014

Economic Research	28 October 2014
Vietnam
Economic Highlights
Key Economic Activities Weakened In October, But Growth Remains On Track To Improve In The 4Q Vietnam’s industrial production moderated in October, indicating weaker industrial activities in tandem with a slower increase in external demand. Exports also weakened during the month on account of slower shipments of manufactured and agriculture output, made worse by a bigger decline in exports from the mining sector. Retail sales, on the other hand, remained stable in January-October period, while the headline inflation moderated to its lowest level since 2009 in October helped by several petrol price cuts over the past three months. As a whole, the key economic data in October suggest that Vietnam’s economic activities have weakened but it remained resilient, as export growth and industrial activities continued to record sustained increases amid moderating price pressure. We expect economic growth in the 4Q of the year to pick up pace, on account of improving outlook for exports following the devaluation of VND, while the monetary policy remains accommodative amid subdued inflation. For the full-year, we expect real GDP to grow by 5.7% in 2014, faster than +5.4% in 2013. Further out, we expect the economy to improve steadily to 6.2% in 2015. Economist:  Peck Boon Soon  | +603 9280 2163 Economist:  Shafizal Shafaai  | +603 9280 2179