France's annual consumer inflation rate reached 2.1% in July, according to provisional data released by the French National Institute of Statistics and Economic Studies on Friday.
The July figure represents an increase from the 1.8% annual inflation rate recorded in June. While some economists had expected the rate to remain unchanged at 1.8%, the monthly consumer price index for France rose by 0.6% in July, following a 0.3% decrease in June.
Drivers of inflation
The acceleration in July was primarily driven by stronger increases in energy and services prices. Energy inflation rose to 12.4% in July from 11% in June, fueled by higher prices for gas and petroleum products.
Services prices also saw an upward trend, rising 2.3% year on year in July compared to 1.9% in June. This increase in the services sector was led particularly by accommodation and communication services.
France's consumer inflation in July
Food and manufactured goods
Food prices increased by 0.9% annually in July, remaining unchanged from the previous month. However, fresh food inflation climbed to 3.8% in July, up from 2.7% in June.
In contrast, manufactured product prices fell 0.7% year on year in July, a less significant decline than the 1.1% drop seen in June. This decline in manufactured goods was attributed to summer sales.
EU-harmonized index
The EU-harmonized consumer price index for France rose 2.4% year on year in July, up from 2% in June. On a monthly basis, the EU-harmonized index increased by 0.6% in July.