- CPI +1.8% vs +2.1% y/y expected
- Prior +2.4%
- HICP +2.0% vs +2.3% y/y expected
- Prior +2.8%
Well, it's good news all around as French headline annual inflation is indicated to fall back below 2% in June. That should at least help to ease some of the pressure on the ECB to want to act in July, affording them some flexibility until after the summer.
The details show that energy prices fell back significantly, leading to a drag on the month even as they remain relatively high on the year-on-year metric. That said, even the latter is down from +16.6% in May to +11.2% in June now.
But elsewhere, there were also notable declines with food price inflation dropping to 0.9% from 1.1% previously and also services inflation falling to 1.8% from 2.1% previously. So, those were also key contributors to the drop in French inflation in June compared to May. And that should also feed through to the core estimate when we get to the final report.
