As has happened in the Spanish case, energy and food have pushed inflation up in France in February. The annual rate of CPI in the second largest economy in the Eurozone has climbed to levels not seen since the 1980s. The rebound in CPI in two of the four largest economies in the euro gives more arguments to the European Central Bank (ECB) to go ahead with rate hikes.
The preliminary reading of the CPI published by the National Institute of Statistics and Economic Studies (Insee, for its acronym in French) confirms that harmonized inflation in France, data that Eurostat takes as a reference to make its comparisons between countries, would have risen in February up to 7.2% from 7% in January, thus reaching its highest level since the creation of the euro.
The greater inflationary pressures respond to higher food prices, which would have risen by 14.5% on average compared to the same month a year ago (they had risen to 13.3% in January), mainly due to the greatest pressure from processed products, which rose by 14.6%, that is, four tenths more than the price of fresh food.
These pressures also respond to a rise in energy that only moderated to 14% (from 16.3% the previous month). In this case, it is decisive, as in the Spanish one, that the comparison is made with a month of February of last year in which the severe impact that the war in Ukraine has had on this heading was not yet appreciated, given that the invasion It took place in the last days of the month.
The final data, just one day before the ECB meeting
“Energy prices could slow down, mitigating the revaluation of regulated electricity rates due to the effect of the fall in the price of oil products,” Insee said in its press release. The French Institute of Statistics also points to an increase in the cost of services of 2.9% year-on-year, three tenths more than the increase registered in January. On the other hand, manufactured products became more expensive by 4.6%, one tenth more than at the beginning of the year with the end of the winter sales.
The French will publish the final inflation data for February on March 15, just one day before the Governing Council of the ECB meets to announce its decision on interest rates (the issuer is expected to place the official rate at 3.5% after raising it by another 50 basis points) and that it also make public its new economic forecasts for the region.