ECONOMY: Inflation slowed markedly in May to stand at 5.1% year on year, after reaching 5.9% in April and over 6% at the start of the year
Good news. After hitting record highs for several months, inflation slowed markedly in France in May. It stood at 5.1% over one year, after reaching 5.9% in April and more than 6% at the start of the year, according to an initial estimate published on Wednesday by INSEE.
“This drop in inflation would be due to the year-on-year slowdown in energy prices (…) of manufactured goods and services”, but also food, up 14.1% year-on-year in May after having grown by 15% in April, indicates the National Institute of Statistics and Economic Studies (Insee). The increase in the price of fresh products (+10.4% year on year) continued almost at the same pace as in April (+10.6%), but the cost of other food products, on the other hand, increased less rapidly (14.8% against 15.8% in April).
Energy prices on the front line
Disinflation is even more apparent for energy, where prices rose 2% year on year in May, after a 6.8% jump in April and double-digit growth in recent months. The cost of manufactured goods (+4.1% year on year in May) and services (+3%) also decelerated, but less rapidly.
The tobacco exception
Tobacco, the cost of which jumped 9.8% over one year in May, is the only exception to the disinflation movement and its price is accelerating for the third consecutive month, notes INSEE all the same.
Benchmark indicator for comparisons between European countries, the harmonized index of consumer prices (HICP) rose by 6% year on year in May, a growth rate nearly one point lower than in April (+6 .9%). Insee is due to publish a second inflation estimate in May in mid-June.
