French Inflation Rate at 7-Month Low of 1.9% in November

The annual inflation rate in France decreased to 1.9 percent in November of 2018 from 2.2 percent in October, a preliminary estimate showed. It is the lowest inflation rate since April, amid a slowdown in prices of services, energy, food and tobacco. Cost of manufactured products should fall less.

Year-on-year, energy prices are set to ease to 11.3 percent in November of 2018 from 13.8 percent in October and services cost should increase 1.1 percent, after a 1.2 percent rise in the prior month. Also, inflation must soften for food (1.9 percent vs 2.2 percent), mainly due to slowing prices of fresh food (5.0 percent vs 7.0 percent) and tobacco (14.5 percent vs 16.8 percent). Meanwhile, prices should drop less for manufactured products (-0.3 percent vs -0.4 percent).

On a monthly basis, consumer prices are expected to went down 0.2 percent, after edging up 0.1 percent in the previous month, in line with market expectations. The main downward pressure must come from lower cost of energy, after seven months of consecutive rise, in the wake of petroleum product prices. Services prices should also drop due to a seasonal downturn in airfares and a fall in communication services. Food prices must decrease, as in the previous month. Those of manufactured products should rise slightly after a stability in the previous month.

The harmonised index of consumer prices is expected to rise by 2.2 percent from the previous year, below 2.5 percent in the previous month; and decrease by 0.2 percent month-over-month (vs 0.1 percent in October).

French Inflation Rate at 7-Month Low of 1.9% in November

Insee | Luisa Carvalho |
11/30/2018 9:07:53 AM