INSEE confirms inflation of 2.2% in April, slightly slowing

INSEE confirms inflation of 2.2% in April, slightly slowing
INSEE confirms inflation of 2.2% in April, slightly slowing

INSEE confirmed its first estimate of a slight slowdown in inflation, against a backdrop of a more moderate rise in food prices. After inflation of 2.3% in March, the drop “results from the slowdown over one year in the prices of food (+1.2% after +1.7%) and tobacco (+9.0% after + 10.7%).

Prices increased by 2.2% in April over one year, INSEE said on Wednesday, confirming its first estimate of a slight slowdown in inflation, against a backdrop of a more moderate rise in food prices. After inflation of 2.3% in March, the drop “results from the slowdown over one year in the prices of food (+1.2% after +1.7%) and tobacco (+9.0% after + 10.7%)”, specifies the institute in a press release.

Prices of services have increased over a year

The prices of manufactured products even fell slightly, by 0.1% after +0.1% in March. The prices of services, which represent almost half of consumption, increased over one year at the same rate as in March, +3%, according to these final data in line with the provisional figures published at the end of April. Over one month, however, inflation accelerates to 0.5% (compared to 0.2% in March), indicates INSEE, again confirming its first estimate – a development due in particular to the rise in prices of services (+ 1%, after stability in March).

Towards a reduction in ECB key rates?

Conversely, “the prices of manufactured products and tobacco are stable” over one month. Over one year, the harmonized consumer price index (HICP, which allows comparisons with other EU countries and is of particular interest to the European Central Bank for its monetary policy) increases by 2.4% in April 2024, as in March, and 0.6% over the month, after +0.2% in March. These figures are also in line with initial estimates.

At its last meeting in April, the ECB considered it “plausible” to start lowering its key rates – currently at their highest – in June if the data confirms the anticipated return of inflation in the euro zone by then. to the target of 2%, according to the report published last week. The guardians of the euro expect inflation to return to this target in 2025, after 2.3% in 2024.

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