France Inflation Rate Unexpectedly Picks Up

The annual inflation rate in France accelerated to 2.1% in July 2026, defying market expectations that it would hold at June's 1.8%, according to preliminary estimates. The pickup was mainly driven by faster increases in services prices (2.3% vs. 1.9% in June), particularly for accommodation and communication services, alongside stronger energy inflation (12.4% vs. 11.0%) amid higher gas and petroleum product prices. Meanwhile, the decline in manufactured goods prices eased (-0.7% vs. -1.1%), partly reflecting less pronounced seasonal sales effects, while food inflation held steady at 0.9% and tobacco inflation remained unchanged at 3.3%. On a monthly basis, consumer prices rose 0.6%, rebounding from a 0.3% decline in June, driven by seasonal increases in transport and accommodation services as well as higher energy prices. The EU-harmonised annual inflation rate also accelerated to 2.4% from 2.0%, while the monthly HICP increased 0.6% after falling 0.3% in June.

The annual inflation rate in France eased to 1.8% in June 2026 from an over two-year high of 2.4% in May, confirming preliminary estimates. The slowdown was primarily driven by a sharp moderation in energy price growth (11.0% vs 16.6% in May), particularly for petroleum products. Services (1.9% vs 2.1%) and food (0.9% vs 1.1%) inflation also eased, while prices for manufactured goods fell at a faster pace (-1.1% vs -0.6%), partly reflecting calendar effects, as the June price collection period included three days of seasonal sales compared with none a year earlier. In contrast, tobacco inflation edged up to 3.3% from 3.2%. Core inflation slowed to 1.0% from 1.5%. On a monthly basis, consumer prices fell 0.3%, the first decline since January, driven by a sharp drop in energy prices, particularly petroleum products. The EU-harmonised CPI also rose 2.0% year-on-year, down from 2.8% in May, while falling 0.3% on the month.

The annual inflation rate in France slowed to 1.8% in June 2026 from 2024-highs of 2.4% in May, and below expectations of 2.1%, preliminary estimates showed. The decline in inflation was primarily driven by a sharp slowdown in energy price growth, particularly for petroleum products, although energy prices remained significantly higher than a year earlier (11.2% vs 16.6% in May). Services (1.8% vs 2.1%) and food (0.9% vs 1.1%) inflation also eased while prices for manufactured goods declined at a faster pace (-0.9% vs -0.6%), partly due to calendar effects, as the June data collection period included more days of seasonal sales than in the previous year. In contrast, tobacco prices increased at a slightly faster pace (3.3% vs 3.2%). Compared to the previous month, the CPI declined 0.2%, the first fall in five months, led by a sharp decline in energy prices, mainly petroleum products. Considering the EU-harmonised CPI, prices rose 2% yoy (vs 2.8% in May) and dropped 0.3% on the month.