According to the preliminary report from INSEE, consumer prices rose by 0.6% in August, accelerating compared to July (+0.2%), and recording the strongest growth since February. Economists had expected an increase of 0.5%. The latest change was caused by rising prices for manufactured goods, food and services. Meanwhile, energy prices have declined.
In annual terms, CPI rose by 1.9% (the lowest reading since August 2021) after increasing by 2.3% in July. Economists had expected an increase of 1.8% per annum. The decrease in inflation is mainly due to a slowdown in energy prices, with petroleum costs expected to fall and electricity prices to ease. Meanwhile, service prices, particularly for accommodation and transport, are expected to pick up over the year, and costs for food, manufactured goods, and tobacco are seen to increase at a similar rate to July.
The data also showed that in August, the harmonized index of consumer prices (HICP) - an indicator that allows to compare inflation in France with inflation in European countries - rose by 0.6% on a monthly basis and by 2.2% per annum. In July, HICP increased by 0.2% m/m and by 2.7% per annum.