France's consumer price index (CPI) is expected to rise 2.1 percent year on year in July, after easing to 1.8 percent in June, according to preliminary data released on Friday by the National Institute of Statistics and Economic Studies (INSEE).
In its provisional estimate, INSEE said the acceleration in inflation was driven by faster increases in service prices, particularly accommodation and communication services, as well as higher energy prices boosted by rising gas and petroleum product prices.
On a monthly basis, consumer prices are expected to increase 0.6 percent in July, rebounding from a 0.3-percent decline in June.
By contrast, manufactured goods prices were projected to decline due to the summer sales, while food and tobacco prices were expected to remain broadly stable.
The Harmonised Index of Consumer Prices, used for comparisons across the eurozone, is expected to rise 2.4 percent year on year in July, up from 2.0 percent in June.
France's Ministry of Economy and Finance said, as quoted by French daily Le Figaro, that inflation remained "contained" following the June data, which came as the country's economy expanded by 0.2 percent in the second quarter.
France's CPI to rise 2.1 pct in July
France's CPI to rise 2.1 pct in July
Annual inflation in the eurozone is expected to edge up to 2.9 percent in July from 2.8 percent in June, according to a flash estimate released by Eurostat on Friday.
The increase was mainly driven by renewed energy price pressure. Energy prices are expected to rise 10.0 percent year-on-year in July, up from 8.5 percent in June, according to Eurostat, the statistical office of the European Union (EU). Services inflation is also expected to rise to 3.3 percent from 3.2 percent a month earlier.
Food, alcohol and tobacco prices are estimated to rise 1.2 percent year-on-year, down from 1.5 percent in June, while non-energy industrial goods are expected to post an annual inflation rate of 0.9 percent, up from 0.7 percent. Core inflation, which excludes energy, food, alcohol and tobacco, is estimated at 2.5 percent in July, up from 2.4 percent in June.
According to Eurostat data, inflation rose in three of the eurozone's largest economies in July. Germany's rate increased to 2.8 percent from 2.4 percent in June, France's to 2.4 percent from 2.0 percent, and Spain's to 3.8 percent from 3.6 percent. Italy's rate, meanwhile, edged down to 2.9 percent from 3.0 percent.
Among eurozone members with available data, Lithuania is estimated to have posted the highest annual inflation rate in July at 5.6 percent, while Estonia is estimated to have posted the lowest at 2.0 percent.
The data came after the European Central Bank (ECB) decided last week to keep its three key interest rates unchanged. The ECB said that the outlook for energy prices remained highly volatile and the full inflationary impact of the energy shock had yet to play out.
Eurozone inflation edges up to 2.9 pct in July as energy prices rise
