French Inflation Rate at 4-Month High of 0.9% in August


French consumer price inflation is expected to increase to 0.9 percent year-on-year in August 2017, following a 0.7 percent rise in the prior two months, the preliminary estimate showed. It was the highest inflation rate since April, mainly due to a surge in energy prices.

Year-on-year, upward pressure came from: Energy (4.9 percent from 1.9 percent in July); food (0.6 percent from 0.7 percent), of which fresh food (-0.8 percent from 0.4 percent) and other food (0.9 percent from 0.8 percent); tobacco (2.4 percent, the same as in July); and services (1.1 percent from 1.0 percent). In contrast, prices of manufactured products fell 0.6 percent, after a 0.4 percent decline in July.

On a monthly basis, consumer prices are expected to rise by 0.5 percent in August, recovering from a 0.3 percent drop in July. This increase should mainly be due to a seasonal rebound in manufactured product prices after the summer sales in the metropolitan area, and a seasonal momentum, in the prices of some tourism-related services. Energy prices should pick up strongly, due to the annual revision in electricity fees and a rebound in petroleum product prices. Food prices are set to be stable after a slight rise in the previous month.

The harmonised index of consumer prices is expected to rise by 1.0 percent from the previous year; and by 0.6 percent from the previous month.

Insee l Rida Husna | rida@tradingeconomics.com
8/31/2017 1:28:32 PM