French Inflation Rate Flat at 0.7% in July


French annual inflation rate is expected to stay at 0.7 percent in July 2017, unchanged from the previous month's six month low, the preliminary estimate showed. Cost increased further for food, energy and services while prices of manufactured products continued to fall.

Year-on-year, upward pressure came from: Food (0.7 percent from 0.8 percent in June), of which fresh food (0.3 percent from 1.5 percent) and other food (0.8 percent from 0.6 percent); tobacco (2.4 percent, the same as in June); energy (2 percent from 1.9 percent); and services (1 percent from 0.9 percent). In contrast, prices of manufactured products fell 0.3 percent, the same as in June.

On a monthly basis, consumer prices are expected to decline by 0.3 percent in July after showing no gain in June. The decrease should come from a significant downturn in manufactured product prices due to the summer sales and a further drop in energy prices. Contrariwise, services prices should accelerate sharply in the wake of airfares and accomodation services owing to summer holidays. Food prices should recovered slightly after a downturn in the previous month.

The harmonised index of consumer prices is expected to rise by 0.8 percent from the previous year; and fall by 0.4 percent from the previous month.

Insee l Rida Husna | rida@tradingeconomics.com
7/28/2017 11:24:56 AM