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Flash Aug HICP Preview: Higher Headline On Electricity Prices

FRANCE DATA

France (20% of EZ HICP) – 0745UK Thu 31 Aug

  • Consensus HICP: 5.4% Y/Y (5.1% prior) / 1.0% M/M (0.0% prior)
  • Consensus CPI: 4.6% Y/Y (4.3% prior) / 0.8% M/M (0.1% prior)
  • With German and Spanish inflation marginally stronger than expected Wednesday, France (20% of the Eurozone inflation basket) will be the final major piece of the puzzle ahead of the EZ release at 1000UK Thursday (which arrives simultaneously with the Italian print).
  • Measured electricity prices are set to soar as France adjusts its price cap (+10%), seen contributing heavily to overall Eurozone headline inflation in August; gas prices are seen as disinflationary.
  • August flash PMIs showed French inflation rates continued on their downward trajectory, with overall input price inflation down to a 29-month low, and selling price inflation slowing to its weakest since April 2021. However that masked mixed sectoral dynamics: manufactured goods output prices fell but services charges rose.

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