Inflation continued to accelerate in April in France to reach 4.8% over one year, a level not seen since November 1985, according to an initial estimate published Friday by INSEE.
Inflation continued to accelerate in April in France to reach 4.8% over one year, a level not seen since November 1985, according to an initial estimate published Friday by INSEE. After reaching 3.6% in February and 4.5% in March on a year-on-year basis, the rise in consumer prices was however moderated in April by a lesser acceleration in energy prices. These nevertheless increased by 26.6% over one year, after having jumped by 29.2% in March.
In this first estimate, INSEE estimates that in April, “energy prices would fall back in line with the fall in the price of petroleum products, and those of manufactured products would slow down”. On the other hand, the waltz of labels is accelerating in food, services and manufactured goods. In food, inflation reached 3.8% over one year, after rising 2.9% in March. The prices of manufactured goods and services increased by 2.7% and 2.9% respectively compared to April 2021. Over one month, consumer prices increased by 0.4%, after 1.4 % between February and March 2022. The harmonized index (HICP), which serves as a basis for comparison at European level, increased by 5.4% year-on-year, after 5.1% in March.
Peak “very close”
The slight slowdown in the rate of inflation growth places France in a broader European trend. On Thursday, Germany thus announced an inflation rate of 7.4% over one year in April, after 7.3% in March. The index rose by 8.4% over one year in Spain, down from March (9.8%). The Italian inflation figure is expected later on Friday morning. Thursday, the vice-president of the European Central Bank Luis de Guindos had judged inflation in the euro zone “very close” to its peak.
“The sharp deceleration in growth (0% in France in the first quarter according to INSEE) and the weakness of consumer demand are likely to begin to limit the room for maneuver of companies, which will have less facility to pass on increases in costs on selling prices,” says Charlotte de Montpellier, economist at ING. “This should contribute to a slowdown in inflation from the end of the summer” in France, she adds. Despite this apparent slowdown in the pace of inflation, the consumer price index remains at a historically high level in Europe. In France, it should cross the 5% mark “in the coming months”, according to ING projections. INSEE is due to publish its final estimate of inflation for April on May 13.