France’s inflation rate fell for a second month in February as a slowing economy outweighed the impact of higher energy prices.
Consumer prices rose 2.5 percent from a year earlier based on European Union methodology, compared with a 2.6 percent increase in January and a 2.7 percent gain in November, Paris- based national statistics office Insee said today. Economists had forecast a rate of 2.6 percent, the median of 18 estimates in a Bloomberg News survey showed. Prices rose 0.5 percent in the month after declining 0.4 percent in January.
With London crude-oil prices up 16 percent this year and the French government seeking more revenue through sales-tax increases, prices may keep rising in euro area’s second-largest economy. The European Central Bank raised its average 2012 inflation forecast for the region last week to 2.4 percent from 2 percent in December even as it reduced its growth outlook.
“We see upward risks coming from higher-than-expected oil prices,” ECB President Mario Draghi said last week. “Owing to rises in energy prices and indirect taxes, inflation rates are now likely to stay above 2 percent in 2012, with upside risks prevailing,” he added.
French consumer price increases of 2.7 percent in both November and December were the highest since Oct. 2008.
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