FRANCE DATA
France Final HICP data for August was broadly in-line with the flash reading at 2.19% (vs 2.23% flash, 2.70% July), and 0.60% M/M (vs 0.64% flash, 0.20% in July). Rounded to 1dp these numbers were unrevised. Recall, flash HICP Y/Y came in 0.1pp above consensus.
- France national CPI came in 0.05ppt below flash at 1.83% Y/Y (vs 1.88% flash, 2.30% in July), and 0.53% M/M (vs 0.58% flash, 0.18% prior). Rounded to 1dp there was a 0.1ppt downward revision to both Y/Y and M/M.
- Seasonally adjusted national CPI softened to 0.22% M/M in August from 0.38% in July
- Core CPI picked up to 1.74% Y/Y in August (from 1.55% in July).
- The softer than expected CPI reading was driven by a sharp slowdown in energy prices to 0.44% Y/Y (vs 8.48% prior) due to a slowdown in electricity prices and decline in price of petroleum products of 8.2% Y/Y (vs 1.1% prior); mainly due to base effects linked to the increase in regulated electricity tariffs applied in August 2023.
- Manufactured products also declined by 0.07% Y/Y (vs +0.01% prior) whilst Food and Tobacco CPI remained broadly unchanged at 0.50% Y/Y (vs 0.52% prior) and 8.72% Y/Y.
- Services prices, on the other hand, accelerated to 3.01% Y/Y (vs 2.59% in July). This is due to a strong rebound in transport services prices (4.5% Y/Y vs -0.9% prior) on the back of base effects for train and air travel. Accommodation services prices also increased by 4.7% Y/Y (vs 2.1% in July) – likely impacted by the Olympics.
- The graph below on seasonally adjusted CPI highlights that whilst inflation momentum remains elevated it is gradually returning back to target.
- MNI's inflation breadth analysis shows that the proportion of components with inflation below 2% and above 6% remained broadly unchanged at 60.9% (vs 62.1% in July), and 10.3% from 10.7% in July.
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