Consumer prices in France touched a fresh record in June, according to EU-harmonized preliminary data on Thursday, putting further pressure on the European Central Bank and French President Emmanuel Macron to tackle soaring inflation.
France’s INSEE statistics agency said its consumer price index – a key measure of inflation in the country – climbed to 6.5%, up from 5.8% in May and in line with estimates. It marked the second-straight month where inflation hit the highest rate since France started using the EU’s calculation methods in the early 1990s.
INSEE added that the uptick was driven by increasing costs for energy and food.
On a monthly basis, consumer prices moved higher by 0.8%, even with the same reading in May.
INSEE also said annual inflation, using France’s national consumer price index, jumped to 5.8% year-on-year from a revised reading of 5.2% in May. Analysts had expected CPI to come in at 5.7%.
French President Emmanuel Macron has vowed to address high inflation through a package of measures, including tax cuts and pension hikes. However, Macron’s ability to enact more changes to bring down prices may now be hampered after his party failed to win an absolute majority in parliament in elections earlier this month.
Meanwhile, the latest inflation data from France comes as the European Central Bank debates its short-term monetary policy. The central bank looks set to raise interest rates for the first time since 2011 in July, with ECB President Christine Lagarde warning this week that prices across the eurozone are “undesirably high.” The ECB has also suggested it will hike borrowing costs further in September, but the exact size of that move remains uncertain.