Inflation has eroded the French portfolio in recent years. The fight against this phenomenon 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 this inflation, France recorded a slower decline in 2023 compared to the previous year. The beginning of 2024 confirms the downward trend in inflation. Already at the end of January, the National Institute of Statistics and Economic Studies (INSEE) indicated that, according to its first estimate, inflation slowed to 3.1% a year in January compared to 3.7% in December.
These figures have now been confirmed by the same organization in its latest bulletin dated February 16. In this second estimate of inflation in France, INSEE indicates that with 3.1% a year in January, inflation experienced a clear slowdown compared to the percentage seen in December which was 3. 7%.
In detail, the same organization underlines that “this reduction in inflation was driven by a year-on-year slowdown in energy prices (+1.9% compared to +5.7% in December 2023), food (+5.7% after +7.2%), and manufactured goods (+1.4% after +0.7%).” However, some prices have increased. Indeed, services prices rose by +3.2% in January while the figure was +3.1% in December.
Inflation has come down due to fall in fuel prices
INSEE also indicates that at the beginning of the current year, core inflation also slowed and stood at 3% compared to 3.4% in December. It should be noted that this indicator measures inflation by excluding certain products whose prices are particularly volatile, such as food or energy.
It is important to emphasize that the slowdown in energy inflation is mainly due to an increase in gasoline prices by 3.6% in a year, diesel prices by 8.7% while, for its part, electricity prices by 23.2%. . Regarding the drop in fuel prices, it must be said that the trend is reversing with the rise in oil prices in the world markets. Therefore, this reduction cannot be taken for granted given that fuel prices may still skyrocket.
Further, in terms of prices of food products, the downward trend is not confirmed. indeed,
Fresh produce inflation rose to 7.9% in January compared to +8.8% in December 2023. For other food products, the rate was 5.3% in January.
