Inflation in France to stabilize by autumn: INSEE

PARIS, June 24 (Xinhua) -- Following a steady growth during the summer, the year-on-year inflation in France is expected to stabilize between 6.5 and 7 percent in the autumn, the French National Institute of Statistics and Economic Studies (INSEE) said Friday.

At the same time, the annual inflation should be around 5.5 percent in 2022, up from 1.6 percent in 2021, it said.

According to the INSEE, the yearly consumer price index (CPI) reached 5.2 percent in May, a peak not seen since 1985.

This can be put down to household consumption, the weight of energy in prices and the recent measures to limit inflation, the institute said.

Capping regulated gas and electricity prices helped to reduce inflation by about two percentage points in May, the INSEE said.

Provided that the "tariff shield" is upheld until the end of the year, inflation fueled by high energy prices is expected to decrease progressively until the end of the year.

Nevertheless, due to an increase in production costs, the price of food and manufactured goods will increase, the institute said.

The INSEE expects that growing inflation will trigger an automatic revaluation of the guaranteed minimum growth wage this summer or the beginning of autumn.

On the positive side, the INSEE foresees a possible improvement in purchasing power in the second semester due to the additional income support measures.

However, the yearly purchasing power will, on average, decrease by 0.6 percent, the INSEE estimates.

"The international economic environment is largely dependent on the geopolitical and health developments, but also on the reactions of the economic policy towards the increase in inflation," the institute said.

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