Consumer Prices and Economic Conditions | INSEE predicts monthly inflation to exceed 3% until June 2022


INSEE has revised its forecasts for domestic consumer prices (inflation) and economic growth (GDP) for the February 2022 economic update on Tuesday, February 8.

After + 2.9% in January 2022 (provisional value finalized on February 18), the National Institute of Statistical Economics (Insee) predicts inflation rates of + 3.2% to + 3.4% over the next five months. doing. (From February to June). “” Rising production prices should be partially communicated to consumer prices At a press conference on February 8, Julien Pouget and Olivier Simon, heads of the business cycle division, explained from business cycle management.

On the consumer price side of food prices, it is clear that the latter was between the maximum of – 0.1% and + 0.2% of total inflation during the period from December 2020 to June 2021. + 0.4% for the period from December 2021 to June 2022.

You can read it in the Economic Note issued on February 8th “” In France, as in other European countries, producer prices rose throughout 2021. In December 2021, the annual fluctuation of producer prices in the French industry reached + 16.9%. The prices of farmers are the same by orders of magnitude (+ 17.6% in the year of December). ” These rises are “partially” transmitted to consumer prices, especially food prices, with a delay of several months. This is the beginning of this cycle we are witnessing today. A phenomenon that may continue throughout the first half.

Services, for example, should also take into account the fact that “production prices for sea and coastal freight have risen 85% in a year this fall.”


“Furthermore, in the midst of strong geopolitical tensions, the assumption that oil prices rose in January and was used until the forecast period (June 2022) has been revised upwards. Brent’s price is now one barrel. It’s supposed to be fixed at $ 90 per, but Economic report The assumption that the exchange rate of € / $ remains at 1.13 $ / € in December can be read in this document. Also, if the government does not take “tariff shield” measures in the energy sector (gas and electricity), the February 2022 inflation forecast will be 1% higher than the adopted forecast (+3, 3%). You need to be careful.

Growth and risk

However, the growth of the French economy remains dynamic globally, anyway more than some of Europe’s larger neighbors (Germany, Spain, Italy). Only the United States is performing better in terms of GDP growth in terms of developed economies. In France it should reach + 0.3% in the first quarter of 2022 and reach + 0.6% in the period April-June 2022.

This will result in a + 3.2% growth overhang in the middle of the year compared to 2022 as a whole. France’s GDP is 1.8% above pre-crisis levels (4th quarter 2019). However, keep in mind that INSEE experts explain that current GDP growth is below levels without the Covid-19 crisis.

Although household consumption in January seemed a little hesitant, corporate investment remained active and foreign trade continued even during the catch-up phase.

However, health status “continues to condition the continued recovery of certain sectors, directly or indirectly, especially through supply problems from Asia. At the same time, geopolitical tensions (which worsen again raise energy prices). Uncertainty developed earlier in the year, either in terms of (raising) or as a result of monetary policy tightening (Editor’s Note: Inflation levels may increase Central banks raise interest rates ) Or, more structurally, the ability to meet recruitment needs, ”INSEE experts conclude. Some companies in certain sectors have infamous difficulties in hiring.

To monitor these developments, INSEE will publish January inflation on February 18th and an initial estimate of February price movements on February 25th. A complete forecast note on the French economy is scheduled for March 15.