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French December Inflation Confirmed At 4.1%, Consumers Spend More Than Expected

By Reuters
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French December Inflation Confirmed At 4.1%, Consumers Spend More Than Expected

Inflation in France was confirmed at 4.1% year-on-year in December, while November consumer spending unexpectedly rose, France's statistics agency INSEE said.

INSEE confirmed its preliminary inflation data published last week showing it accelerating in December, largely due to higher energy and services prices, from the 3.9% recorded for November.

In the agency's final reading, energy prices accelerated slightly more than initially forecast, up by 5.7% year-on-year in December, compared with a preliminary figure of 5.6%.

Services rose by 3.1%, INSEE confirmed.

Food Prices

Food prices continued going up, but once again at a slower pace, rising by 7.2% from 7.7% in the previous month, the agency added.


This marked the ninth month in a row when food price inflation slowed, INSEE said.

The figures are EU-harmonised, meaning they employ a common methodology for calculating inflation in European Union member states to allow comparisons.

Price Negotiations

France's government hopes this month's annual price negotiations between retailers and food producers will lead to lower prices for consumers, even as some companies engage in a pricing tug-of-war.

Carrefour is telling customers in four European countries it will no longer sell products such as Pepsi, Lay's crisps and 7up because they have become too costly.


French consumer spending, meanwhile, came in higher than expected, rising by 0.7% in November from the previous month, while economists polled by Reuters had forecast a decline of 0.1%.

"This increase is explained by a rebound in energy consumption... and by a further increase in the consumption of manufactured goods," INSEE said in a statement, adding food consumption was stable.

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