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ING: Fransk inflation overrasker positivt med fald

Morten W. Langer

tirsdag 30. juni 2026 kl. 9:50

Fra ING:

French inflation surprises on the downside

Inflation in France came in lower than expected in June. It is expected to pick up again in the coming months, but only to a limited extent
French inflation was weaker-than-expected in June due to the drop in oil prices

French inflation was weaker-than-expected in June due to the drop in oil prices

Following the decline in oil prices, inflationary pressures in France eased in June, with consumer prices rising by 1.8% year-on-year, down from 2.4% in May, according to Insee data. This decline is mainly driven by energy prices, which increased by 11.2% in June compared with 16.6% in May. Services inflation also slowed (+1.8% vs. +2.1%), as did food prices (+0.9% vs. +1.1% in May).

In addition, the timing of the summer sales, which unlike last year, started as early as June, further amplified the decline in manufactured goods prices. These fell by 0.9% YoY in June, after a drop of 0.6% in May. The harmonised index, closely watched by the European Central Bank, also declined to 2.0%, from 2.8% in May.

Overall, these inflation figures are weaker than expected by the consensus and can be interpreted as a “dovish” signal for the ECB. In its economic outlook published on 16 June, Insee had still expected domestic inflation to reach 2% in June. Both food and services inflation pressures turned out to be weaker than anticipated. The data therefore confirms that the risk of an inflationary spiral remains extremely low in France and significantly more limited than in neighbouring countries.

Nevertheless, inflation is expected to rise again in the coming months. On the one hand, the June figure is artificially pushed down by the timing of the sales. On the other hand, several factors are likely to contribute to a rebound. The increase in the minimum wage, indexed to inflation, should again support services prices, which could approach 2.5% by the end of the year. Transport and telecommunications services prices, in the context of reduced competition, are also expected to rise. Food inflation should gradually increase, as higher energy costs typically take several months to feed through to food prices. Energy inflation is also expected to remain clearly positive for the rest of the year.

However, the expected increase in inflation in the coming months should remain limited, given the current weakness in domestic demand in France, low consumer confidence, and the downward revision of firms’ price expectations in surveys. On average in 2026, French inflation is expected to remain below that of the eurozone and to range between 2% and 2.5%, after averaging 0.9% in 2025.

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