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Steady Reading On French Inflation

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Steady Reading On French Inflation

Prices in France have maintained their pace of growth during the month of May, according to the data just received from the country’s National Institute of Statistics and Economic Studies (INSEE). The final figures published by INSEE are updates to the earlier preliminary inflation numbers and as such contain little surprise, in the current environment however any inflation information from the Eurozone has the potential to be pertinent.

The headline Consumer Price Index (CPI) has come in at 0.8% growth when measured year on year, there is no change here from the April reading nor is there any deviation from the consensus estimate. It has to be noted that this CPI reading is the EU Normalized one, this is the one calculated using the European Central Bank’s methodology as opposed to the domestic French calculation. Month on month the CPI showed that prices remained as they were, this 0% reading is in line with the April reading but moderately behind the growth of 0.1% anticipated by the market.

Using the French authorities calculations does not dramatically alter the inflation picture for the economy. The official CPI year on year reading has been published as 0.7% for the month of May, this is in keeping with the April reading and also in line with market consensus expectation. Month on month the French CPI reading showed now change in prices at 0%, this was expected to rise to 0.1% but in the end just came in in line with the flat growth seen in April. To cement the lack of monthly price growth, the ex-Tobacco number also came in at 0% growth for the second month in a row.

Finally, this mornings data package also contained an offering from the Banque de France on April’s Current Account balance, this has produced a moderate increase in the monthly deficit from -€1.5Bn in March to the most current reading of -€1.6Bn for the month of April.

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