2021.08.3107:50:00UTC+00France Inflation Highest Since 2018

France consumer prices grew at the fastest pace in nearly three years in August largely driven by the rebound in manufactured goods prices linked to the end of summer sales, the provisional estimate from the statistical office Insee showed on Tuesday.

Consumer price inflation rose more-than-expected to 1.9 percent in August from 1.2 percent in July. Economists had forecast the inflation rate to rise to 1.7 percent. This was the highest since October 2018, when the price growth was 2.2 percent.

On a monthly basis, consumer prices gained 0.6 percent in August versus a 0.1 percent rise in the previous month. Prices were forecast to climb 0.4 percent.

EU harmonized inflation advanced to 2.4 percent from 1.5 percent in the previous month. This was also above economists' forecast of 2.1 percent. Final data is due on September 15.

Month-on-month, the harmonized index of consumer prices climbed at a faster pace of 0.7 percent after rising 0.1 percent in July. The HICP was expected to rise 0.5 percent.

Manufactured product prices rebounded 1.3 percent and energy prices advanced 12.7 percent annually. Food prices increased 1.2 percent and services costs gained 0.7 percent.

Another report from the Insee showed that domestic producer price inflation accelerated to 8.6 percent in July from 7.6 percent a month ago. On month, the producer price index rose 1.3 percent after climbing 1.1 percent in June.