Economy / Vietnam
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Wage Growth No Major Risk, For Now
October 2007 | Market StrategySorry, you must be a subscriber to view this article in full. If you are a subscriber please login.
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BMI View: Indications that wage growth is now picking up in the wake of rampant inflation emphasise the need for the government to step up its efforts to quell inflation. A failure to do this would likely result in entrenched inflation expectations, undermine competitiveness and affect growth negatively. We thus reiterate our view that the rising inflation poses a threat to short- and medium-term growth. Nonetheless, the risk to our 2007 GDP forecast of 8.2% is on the upside, with downside risks to growth lying in the years ahead.