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French inflation eases to six-month low in March

Published 03/31/2023, 04:00 AM
Updated 03/31/2023, 04:06 AM
© Reuters. FILE PHOTO: A woman walks with a shopping trolley as she shops in an Utile supermarket in La Verrie, France, December 9, 2022. REUTERS/Stephane Mahe

PARIS (Reuters) - French inflation slid in March to a six-month low - though by slightly less than forecast - as a sharp drop in energy price inflation helped offset surging food prices, preliminary official data showed on Friday.

Consumer prices rose 0.9% in March, bringing the 12-month inflation rate to 6.6%, down from 7.3% in February, according to EU-harmonised data from France's statistics agency INSEE.

A Reuters poll of 20 economists had forecast an inflation rate of 6.5%.

Energy prices rose 4.9% this month after an increase of 14.1% in February when a 15% hike in regulated electricity prices took effect.

However, food prices kept climbing, reaching a record high of 15.8% after 14.8% in February following an agreement for a 10% increase in negotiated prices between big food retailers and their suppliers from the start of March.

German inflation also eased in March on the back of lower energy prices but still came in above forecast, adding to pressure on the European Central Bank to further tighten its monetary policy.

© Reuters. FILE PHOTO: A woman walks with a shopping trolley as she shops in an Utile supermarket in La Verrie, France, December 9, 2022. REUTERS/Stephane Mahe

The central bank expects the decline in inflation to accelerate from the second half of the year once the increase in regulated power prices and the food price agreement are further in the rearview mirror.

Using a national gauge of inflation not in line with EU-approved methodology, consumer prices rose 0.8% in March, giving a 12-month inflation rate of 5.6%, down from 6.3% in February, INSEE said.

 

 

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