Inflation rates across Europe have shown significant declines in September 2024, with the UK and France both reporting notable drops. In the UK, inflation fell to 1.7%, its lowest level since 2021, while France recorded a year-on-year increase of just 1.1%, down from 1.8% in August. This trend indicates a broader slowdown in consumer prices, driven largely by decreases in energy costs. In the UK, core inflation, which excludes food and energy prices, also eased to 3.2% from 3.6% in August, falling below analysts' expectations. Similarly, in France, energy prices saw a sharp decline of 3.3%, contributing to the overall reduction in inflation. The UK’s inflation rate has now dipped below the 2% target set by the Bank of England for the first time in three and a half years, while France's harmonised index of consumer prices rose by 1.4% year-on-year, down from 2.2% in August. This significant slowdown in inflation may influence monetary policy decisions in both countries, especially with the European Central Bank closely monitoring these trends.
- The UK’s Statistics Office reported that the consumer prices rose to 1.7% in September, a decrease from 2.2% in August, which was below the 1.9% forecast by analysts. The Bank of England's target for inflation is 2%, and this drop marks a significant milestone for the UK economy. Core inflation also showed a downward trend, indicating a broader easing of price pressures in the economy. In France, the National Institute of Statistics (INSEE) noted that the consumer price index had been revised downwards, reflecting a more pronounced slowdown than initially estimated. The decline in energy prices is a critical factor, as it has a direct impact on household expenses and overall economic sentiment. The monthly decrease of 1.2% in the consumer price index in France is the largest since 1990, highlighting the scale of the slowdown. This information is crucial for policymakers as they consider potential adjustments to interest rates in response to these changing economic conditions.
