French June inflation to continue to climb

For the month of June, French energy prices are expected to have contributed the most, followed by higher food prices. The ongoing rebound in gasoline prices could continue to provide upside push to the energy component. 

Apart from energy, after the seasonal increase in prices paid for food and tourism related services in May, food prices are expected to provide a muted push and services to remain stable in June. Prices paid for goods which have shown improvement in the last three months are expected to remain stable.

"French HICP inflation is expected to rise to 0.4% yoy in June, up from 0.3% yoy in May", says Societe Generale.

In May, both HICP and national CPI rose by 0.3% yoy. In the headline, the energy component recorded the biggest movement, food registered tepid growth. Within core components, like other euro area countries, services rose and Prices paid for manufactured goods increased slightly.

"Looking ahead, we expect French HICP inflation to average 0.4% in 2015 and 1.4% in 2016, while the core metric should average 0.7% in 2015 and 1.1% in 2016", added Societe Generale.