Despite optimistic forecasts, inflation rebounded in August, according to initial estimates from INSEE. Which sectors are most affected and what can we expect to see in the coming months?
Inflation rises in August in France
Last month, inflation was +4.3%. But according to the first results from INSEE, published today, it rose again in August, to +4.8% over one year. Inflation peaked last February, before gradually falling:
Inflation has been rising since 2017
For INSEE, this rebound is largely due to the rise in energy prices:
” This rise in inflation is due to the rebound in energy prices. […] energy prices are expected to pick up as a result, in particular, of the rise in the price of petroleum products and regulated electricity tariffs on 1 August 2023. “
There has been a fall in price rises in the food sector, which posted +11.1% compared with +12.7% last month. This is particularly the case for food products excluding fresh produce. Manufactured goods and services are also slowing, but to a lesser extent. Manufactured goods rose by 3.1%, compared with 3.4% last month. The latter posted +2.9% compared with +3.1% in July.
Bruno Le Maire wants to negotiate with manufacturers
More and more analysts are pointing the finger at corporate profits which have fuelled inflation. In June, IMF economists estimated that in the eurozone, profits accounted for 45% of inflation. In response to this, the major retailers were received yesterday at the Ministry of the Economy. Negotiations with manufacturers should begin sooner than expected.
In an interview with Le Parisien, French Economy Minister Bruno Le Maire reaffirmed his determination to combat price rises:
“Nothing”.
Nothing has been decided. We’re meeting manufacturers tomorrow [this Thursday]. We have to take each player into account. We’ll see what can and can’t be done. But our aim is to bring prices down.
Last June, the French Economy Minister said that inflation was here to stay, and that the French would not return to pre-Covid levels:
“Is it possible to bring prices down?
“When we come out of this crisis, will we still have inflation levels like those we had before the Covid crisis? The answer is no. […] I don’t think we’ll go back to the very low rates of around 0% that we saw in previous years.
