HSBC ups Vietnam's 2022 growth forecast to 6.9%, lowers 2023's to 6.3%

07 Jul '22

2 min read

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The forecast for Vietnam’s economic growth this year has been raised by HSBC to 6.9 per cent from the earlier projection of 6.6 per cent. However, HSBC revised down the 2023 forecast to 6.3 per cent from 6.7 per cent due to growing risks, especially in the energy sector. Decreasing risks posed by Omicron and eased restrictions have paved the way to normal.

The country’s gross domestic product (GDP) growth rate was 7.7 per cent in the second quarter this year compared to the same period last year.

HSBC Global Research, in its ‘Vietnam at a Glance’ report released this month, pointed out growing impacts of soaring energy prices. Escalating goods prices led to trade deficit in the second quarter this year and may worsen the current account situation, which has not been optimistic.

Though household consumption has steadily recovered, people’s budgets may suffer from high oil prices, thus decelerating the recent recovery speed, a news agency reported citing the HSBC document.

Vietnam’s inflation is forecast to stand at about 3.5 per cent this year, but it may surpass the ceiling of 4 per cent between fourth quarter of this year and the second of 2023, requiring the State Bank of Vietnam to start normalising the monetary policy.

Vietnam has benefited from reopening of the economy, and domestic demand has returned while external drivers remain favourable, the report added.

Fibre2Fashion News Desk (DS)

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