Carole Ferry, edited by Solène Leroux 06:02, May 10, 2022
Are your groceries costing you more and more?
You are right: inflation is very high at 4.8% for the month of April.
And it's not over.
According to INSEE forecasts, prices will continue to rise in the second quarter, and inflation should reach 5.4% in June.
Food prices are going to rise the most.
ANALYSIS
Inflation is expected to reach 5.4% next June, prices driven up both by the war in Ukraine, but also by the zero covid policy practiced in China.
Confinements are multiplying and fueling tensions over supplies, which mechanically drives up prices.
Energy prices remain the main component of this inflation, but their rise should slow down a little in the coming months, and food prices should rise the most between now and this summer.
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Inflation which will therefore remain sustained, but which would have been much higher, beyond 7% according to INSEE, without the energy shield measures put in place by the government.
As a reminder, the state has blocked gas prices, capped the rise in electricity prices and helped the French pump, with a discount of 15 to 18 cents on fuel.
A rise in prices that weighs on growth
This rise in prices should once again weigh on growth in the second quarter, without completely curbing it.
INSEE indeed predicts a very slight rebound in GDP, of 0.25%.
A modest increase, but it is not the contraction that we might have feared after the zero growth of the 1st quarter.
Several factors should support this growth, such as a good business climate and a catch-up phenomenon, particularly in the hotel and catering industry.
The French consumed less services in January, so they could catch up in the spring.
These forecasts are still very dependent on the development of the situation in China and Ukraine.