Inflation in France Drops to 1.2% in September, Easing Consumer Burden
In a significant development for consumers, inflation in France has slowed to 1.2% in September, down from 1.8% in August, as reported by the National Institute of Statistics and Economic Studies (INSEE). This marks the lowest inflation rate in over three years, reflecting a notable shift in the economic landscape as the country grapples with rising costs.
The decline in inflation can be attributed to several factors, including a decrease in energy prices, which fell by 3.3% over the year, and a drop in prices of manufactured goods, which decreased by 0.3%. Services also saw a slowdown in price increases, rising by 2.5% compared to 3% in the previous month. Notably, the cost of food products and tobacco remained stable, increasing only by 0.5% and 8.7% respectively.
For the second consecutive month, the consumer price index (CPI) has stayed below the European Central Bank's inflation target of 2%. The harmonised consumer price index (HICP), which serves as a benchmark across Europe, also fell to 1.5% in September, down from 2.2% in August.
The monthly data reveals an even more striking trend, with prices dropping by 1.2% in September—the largest monthly decline since 1990. This drop is largely attributed to seasonal factors affecting transport and accommodation services, alongside a notable reduction in energy prices. The return to normal pricing after the Olympic and Paralympic Games has also contributed to this trend.
Despite the overall drop in inflation, certain prices such as clothing and shoes have seen an increase, indicating a mixed economic environment. INSEE has projected that inflation will remain below 2% through the end of the year, potentially stabilizing at 1.6% by December 2024.
