French inflation ticks up in December

Inflation in the eurozone’s second-largest economy France accelerated in December, official data showed Thursday, with food prices a persistent sore point for consumers.

Prices grew 3.7 percent year-on-year last month, statistics authority Insee said in preliminary figures, up from the 3.5 percent pace in November.

There had been “acceleration… in the price of energy and services,” Insee said, although price growth slowed for manufactured goods and the closely-watched food items in the consumer basket.

With food inflation still running at 7.1 percent last month, many shoppers have been switching to lower-cost alternatives or scouring supermarkets for special offers.

In response, Paris has brought forward annual talks between food producers and retailers, hoping lower costs for food inputs can be passed through more swiftly to the public.

“We’re going to be looking for areas to bring prices down, we’re going to kick inflation in the teeth,” Michel-Edouard Leclerc, head of the E.Leclerc supermarket chain, told broadcaster France 2 on Tuesday.

Measured using the Harmonised Index of Consumer Prices, the preferred yardstick of the European Central Bank, French inflation also rose from 3.9 percent year-on-year in November to 4.1 percent last month.

In line with other major central banks, the Frankfurt-based institution has increased its benchmark deposit rate to a record high of four percent in a bid to tame price growth in the 20-nation eurozone.