France Inflation Rate Edges Up in April

French annual inflation rate accelerated slightly to 0.7 percent in April of 2014 from 0.6 percent in the previous month, driven by higher prices of tourist services.

Year-on-year, the highest upward pressures came from tobacco prices (6.9 percent), transport and communication services (3 percent) and services (2 percent). Energy prices rose 0.7 percent, as city gas increased 0.6 percent due to the implementation of a new consumption tax for households.

In contrast, food prices fell 0.6 percent in April, driven a 6.2 percent fall in cost of unprocessed food. Cost of manufactured goods fell 0.7 percent, mainly due to declines in cost of household appliances (-2.5 percent), audio-visual, photographic and information processing equipment (-7.3 percent) and telephone equipment (-15.3 percent). Prices of health products continued their decline (-2.3 percent) in the context of the saving measures of the national health insurance expenditure target for 2014. This decrease was offset by the seasonal rebound in the prices of clothing and footwear (0.6 percent) due to the release of the summer collections. 

On a monthly basis, consumer prices were flat in April, following a 0.4 percent increase in March. The relative stability of the CPI masked some contrasting price movements in different categories of services and manufactured products which cancelled out each other. Energy prices and those of food products decreased slightly in April, driven by a new decline of petroleum cost and a large drop in the prices of unprocessed food.

The harmonized index of consumer prices was stable in April 2014 and rose by 0.8 percent year-on-year (up from +0.7 percent in March 2014).

France Inflation Rate Edges Up in April

INSEE | Joana Taborda |
5/14/2014 11:20:20 AM