French consumer prices rose slightly less than expected in August, as weaker declines in energy costs offset a slowdown in service prices, according to preliminary data released by statistics agency INSEE on Friday.
The harmonised inflation rate, which allows comparison with other euro zone countries, increased by 0.8% year-on-year in August. This was lower than the 0.9% recorded in July and below the 0.9% rise forecast by economists in a Reuters poll.
Service prices grew 2.1% year-on-year, down from 2.5% earlier in the year, with transport costs leading the slowdown. Energy prices dropped 6.2% in August, following a 7.2% fall in July, mainly due to lower petroleum product prices.
Food and tobacco prices rose at the same pace as July. Food inflation remained at 1.6% year-on-year, while tobacco prices climbed 4.0%, unchanged from the previous month. Manufactured goods prices continued to decline slightly faster than in July.
Consumer spending in France increased by 0.4% in August compared with July, slightly below economist forecasts of a 0.5% rise. INSEE said the increase was largely seasonal, driven by higher manufactured goods prices after the summer sales, particularly in clothing.
France’s national consumer price index (CPI) showed inflation at 0.9% year-on-year through August, down from 1.0% in July.
