French January Inflation Rate Confirmed at 11-Month Low

France's inflation rate stood at 1.2 percent in January 2019, unrevised from the preliminary estimate and below December's final reading of 1.6 percent. It was the lowest inflation rate since last February, mainly due to a deceleration in energy prices.

Energy inflation slowed to 1.9 percent in January from 8 percent in the previous month, as petroleum products prices rose only by 0.2 percent (vs 9.5 percent in December). Meanwhile, service prices rose at faster pace (1 percent vs 0.9 percent) mainly boosted by health services (0.2 percent vs -0.4 percent) and other services (1.9 percent, the same as in December) while declines were seen in actual rentals and services for dwellings (-0.4 percent vs -0.3 percent), transport (-0.1 percent vs 0.5 percent) and communication (-3.1 percent vs -3.5 percent). Inflation also picked up for food (2.7 percent vs 2.5 percent), of which fresh food (8.4 percent vs 7.8 percent) and other food (1.7 percent vs 1.6 percent), and tobacco (14 percent vs 12.8 percent). Manufactured products cost fell at a softer pace (-0.4 percent vs -0.5 percent).

Annual core inflation, which excludes public sector prices, the most volatile consumer prices and the tax measures stood at 0.7 percent in January, the same as in December.  

On a monthly basis, consumer prices dropped 0.4 percent in January after being unchanged in December and compared with a preliminary estimate of 0.5 percent fall. The prices of manufactured products declined sharply, due to the beginning of winter sales (-2.1 percent vs -0.2 percent) and those of services slowed down (0.2 percent vs 0.4 percent). Food prices were also a little less dynamic than in the previous month (0.5 percent vs 0.6 percent). Contrariwise, energy prices dropped less sharply than in December (-1.2 percent vs -2.4 percent), in the wake of petroleum prices. At least, tobacco prices rose by 0.8 percent after being unchanged in December.

The harmonised index of consumer prices rose by 1.4 percent from the previous year (vs 1.9 percent in December) and fell by 0.6 percent month-over-month (vs 0.1 percent in December).

French January Inflation Rate Confirmed at 11-Month Low

INSEE | Joana Ferreira |
2/21/2019 8:23:43 AM