Inflation continues to fall in France, according to provisional figures released by Insee. It has fallen below the symbolic 3% threshold, with food price inflation slowing sharply over the year. Here’s a look at what’s in store for the rest of 2024.
Inflation continues to slow in France
The French national statistics institute (Insee) yesterday published its provisional figures for inflation in France. These continue the trend set in December and January, with a further slowdown. Year-on-year, inflation reached 2.9% in February, a level not seen since January 2022:
Inflation on the rise since 2017
According to Insee, this slowdown is mainly due to the gradual stabilization of prices for food, manufactured goods and services. Food prices in particular are showing a marked slowdown: 3.6% versus 5.7% last January. Conversely, energy prices rose sharply: 4.4% in February, compared with 1.9% in January.
Insee notes, however, that over one month, prices rose in February, by an average of 0.8%. The year-on-year fall is due to what it calls “base effects”. As prices rose sharply in February 2023, they appear to be lower year-on-year.
The Livret A finally yields more than inflation
For the past two years, inflation has been higher than the Livret A, whose rate has been frozen at 3% since February 2023. This reduction in inflation means that the 55 million French people who hold a Livret A no longer lose money on the funds they have saved. However, the Livret A rate should have reached 4% this year
According to the Banque de France, inflation is expected to average 2.5% in 2024, representing a further slowdown. In Europe, the European Commission expects inflation to average 3% in 2024, compared with 6.3% in 2023.
