2024-01-12 11:48:34
Published on Jan 12, 2024 at 9:43 amUpdated Jan 12, 2024 at 12:48 p.m.
In 2023, average inflation stood at 4.9%, following 5.2% in 2022, INSEE announced this Friday morning. This decline comes at the end of a turbulent year on the price front. “It was marked by the strength of inflation at the start of the year,” notes Mathieu Plane, economist at the OFCE. The price increase initially settled around 6%, even peaking at 6.3% in February. From the month of May, it finally declined once more from the month of May.
In the second part of the year, the deceleration was even faster than experts anticipated. In nine months, inflation rose from 6.3% – the peak reached in February to 3.5% in November before rising to 3.7% in December.
“Below 3% in the first half”
The decline in 2023 is mainly explained by the “sharp slowdown” in oil and gas prices. This slowdown reduced energy inflation from 23% to 5% over one year. On the other hand, prices in the food aisles have accelerated, increasing over one year by almost 12%, compared to 7% in 2022. Just like those of manufactured goods to a lesser extent, however (3.5% following 3%). Inflation in services, on the other hand, remained at the same rate as in 2022, at 3% over one year.
More worrying, underlying inflation – excluding energy and processed food products – strengthened in 2023, reaching +5.1%, following +3.9% in 2022.
“We will be below 3% inflation during the first half of the year,” promised the Minister of the Economy, Bruno Le Maire, during his wishes at the start of the week. According to Bercy, inflation will fall to 2.6% on average this year.
Barring unpleasant surprises linked to the geopolitical context, INSEE experts like other forecasters also consider that the decline in inflation is “on track”. In its December forecasts, the Institute of Statistics expected it to fall to 2.6% in June 2024. Core inflation – excluding energy and processed food products – would be reduced at 2%.
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