Inflation is stabilizing however its results persist, specifically with a pointy decline in consumption | EUROtoday

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Inflation remained secure in May, at 2.2%, in response to figures revealed Friday May 31 by INSEE, confirming the disinflation trajectory which ought to lead in direction of 2% year-on-year, the target set by the Bank. European Central (ECB). The costs of providers, which had change into the driving drive of inflation, have slowed down: over twelve months, they’ve elevated by solely 2.7%, as a substitute of three% in latest months. Manufactured items and meals remained flat. The principal growth considerations vitality, whose costs elevated by 5.8% in comparison with May 2023, a interval once they have been notably low.

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Overall, we are getting back on track, even if there may be ups and downs from one month to the next. », assures Mathieu Plane, deputy director of the Analysis and forecasts department of the French Observatory of Economic Conditions. He estimates that this figure of 2% will be reached in the second part of 2024. A diagnosis shared by Stéphane Colliac, economist at BNP Paribas, who even sees inflation returning to 2% from September. Until then, “ In the short term, we will see pockets of inflation persist in services such as air transport or catering, linked in particular to the summer season and the Olympic Games. », he notes. Core inflation…

The inflationary crisis therefore now seems to be behind us, but households are still showing great caution in their spending, despite a slight increase in purchasing power expected in 2024, “estimated at 1% per consumption unit », Indicates Mathieu Plane. Consumption fell by 0.8% in May, a relapse after a very slight rebound of 0.4% in the first quarter.

Service-led growth

Even if inflation slows, prices remain high, especially the prices of what people consume on a daily basis. Since January 2021, prices have increased by 14% on average, but those of food have increased by 23% and those of energy by 48%. %”, recollects Clémentine Gallès, chief economist at Société Générale Private Banking.

Another rationalization: consumption patterns are altering. Rather than accumulating items – clothes, footwear, ornament or family tools – ​​the French are more and more favoring providers. This is evidenced by the figures from the Federation of e-commerce and distance promoting for the primary quarter: on-line gross sales elevated total by 2.1%, however this development is pushed by providers, and specifically journey. , up 13.3%.

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