Has retreated inflation to France Under the target of 2% of the European Central Bank in August due to the deceleration of services prices.
The indicator stood at 0.8% compared to a year before – remaining below 1% for the seventh consecutive month, according to the Insee Statistical Service on Friday (29.8.25). Analysts who participated in a Bloomberg survey had estimated an increase of 0.9%, which would correspond to the July rise. While prices in France are weaker than most of the eurozone, inflation in the block as a whole is currently responding to the ECB target.
As the economy also turns out to be resilient to the US trade volatility, Policy -in -Frankfurt -executives are expected to keep interest rates steady at 2% for a second month in September, according to Bloomberg.
Investors are no longer fully discounting any further reductions in borrowing costs this year.
On Friday, the region’s four largest economies will announce prices in August, with Spain likely to remain above 2%, but Italy and Germany approaching or approaching this level. Data from the eurozone of 20 states are expected on Tuesday.
France’s economy has lost its potential compared to its counterparts, as prolonged political and fiscal uncertainty has led to reductions in corporate investment and low domestic demand.
The prospects became much more uncertain this week after Prime Minister François Bairou’s surprise call for a vote of confidence in his budget plans – a move that is likely to cause yet another government collapse.
Preliminary consumer prices for August showed that inflation in services – a sector closely monitored by the ECB – slowed down 2.1% from 2.5% last month. The prices of processed goods decreased by 0.3% – the sixth consecutive negative indication. The energy also dropped 6.2%, though it was slightly smaller than in July.
A separate Insee report on Friday showed that consumer spending in July decreased by 0.3% compared to June due to a decrease in energy and clothing costs. The items were in accordance with the expectations.