The fight against inflation is one of Europe’s priorities. A conflict that explains the maintenance of rates at high levels by the European Central Bank. The fruits of this policy are beginning to be seen. Indeed, inflation has started to decline from 2023, especially in France.
In 2023, France saw a decrease in inflation compared to the previous year. According to the INSEE report published on January 12, consumer price increases averaged 4.9% in 2022, compared to 5.2%.
This downward trend was confirmed by the same institution this Wednesday, January 31, which showed that, according to its first estimate, inflation slowed to 3.1% over the year in January, compared to 3.7% in December.
Falling energy prices have had an impact on inflation
The National Institute of Statistics and Economic Studies explained the drop in inflation by year-on-year declines in energy, food and manufactured goods prices, despite an acceleration in services and tobacco prices. In detail, on a month-on-month basis, consumer prices fell slightly in January, down 0.2%, while December saw an increase of 0.1%.
Reacting to this drop in inflation, the Minister of the Economy, Bruno Le Maire, declared on CNews and Europe 1: “ I am committed to ensuring that inflation declines sharply in early 2024. This will be the position: the commitments I make, I will keep them”. This senior official therefore declares victory even if the battle is still difficult, knowing that energy prices can rise at any time, especially due to tensions in the Red Sea.
It must also be said that if inflation has declined, it is mainly due to the relative stability of energy prices. In fact, in January 2024 these prices increased by only 1.8%, while in January 2023, they reached a year-on-year increase of 5.7%. As for food prices, they rose 5.7% year-on-year in January, while they rose 7.2% in December.
In addition, prices of fresh produce are still high. Inflation in this sector is +8.3% in January 2024 compared to January 2023, which was +8.8% in December. Manufactured products, for their part, fell sharply this January to reach inflation of just +0.7%.
