14 August 2013

2013- n° 188

The Consumer Prices Index decreased by 0.3% in July 2013; it rose by 1.1% year-on-year Consumer price index - final results - July 2013

The Consumer Price Index (CPI) were down 0.3% in July 2013, after a rise by 0.2% in June 2013. The inflation rate increased slightly, from 0.9% in June 2013 to 1.1% in July 2013. Seasonally adjusted, the CPI increased by 0.2% in July and by 1.1% compared with the same month one year ago. Excluding tobacco, the CPI went down by 0.3% in July 2013 and it grew by 0.9% compared with the same month one year ago.

In July 2013, the largest contributions to the change in the monthly rate of the CPI came from the decline in the prices of manufactured goods, linked to summer sales, and from seasonal decreases in fresh foodstuff prices. Those decreases were partly offset by the rise, also seasonal, in service prices at the time of the summer holidays, the rebound in energy prices, especially from petroleum products, and from a substantial increase in tobacco prices in July (+ 1.8%; + 8.9% year on year).

Due to summer sales, prices of manufactured products fell significantly in July 2013 (— 2.8%; — 0.5% year on year and — 2.7% in July 2012). The price reductions came mainly from clothing and footwear (— 13.2% on average in July 2013; + 1.5% year on year; — 13.6% in July 2012), travel goods and other carriers of personal effects (— 5.7%; + 1.5% year on year) furniture and furnishings (— 2.8%; + 1.3% year on year), household textiles (— 2.8%; + 2.6% year on year), jewellery, clocks and watches (— 2.6%; + 2.0% year on year) and perfumes and beauty products (— 1.0%; + 0.5% year on year). The summer sales have also fuelled the declining trend in certain product prices. This is especially the case with the prices of household appliances (— 2.4% in July 2013; — 3.1% year on year) and those audio-visual, photographic and information processing equipment (— 1.6% in July 2013; — 7.6% compared with the same month one year ago).

In July 2013, food prices decreased by 0.7% (+ 1.8%, year on year). The downward pressures came from the seasonal fall in prices of fresh foodstuffs (— 5.2%). However, due to adverse weather conditions during the first semester which have reduced supply, the prices of these products rose still sharply compared with the same month one year ago (+ 7.5%, year on year; + 11.0% for fresh fruits and + 5.9% for fresh vegetables). Excluding fresh products, the rate of change in food prices have been more moderate in July 2013 (+ 0.1% like in June 2013; + 1.0% compared with the same month one year ago). The meat prices rose by 0.2% (+ 3.1%, year on year), those of milk cheeses and eggs by 0.2% (—0.8%, year on year) and those of oils and fats by 0.4% (+ 0.8% year on year).

Seasonally, prices for services increased significantly at the time of the summer holidays (+ 1.1% in July 2013 and compared with the same month one year ago; + 1.0% in July 2012). Thus, the prices of accommodation services grew by 10.8% in July 2013 (+ 12.2% in July 2012) and by 0.2%, year on year. Similarly, the prices of package holidays rose by 18.5% in July 2013 (+ 23.9% in July 2012) while they remained virtually stable compared with the same month one year ago (+ 0.1%). Seasonally, the airfare soared also in July (+ 15.1%; — 0.9%, year on year; + 14.1% in July 2012). Moreover, the prices of telecommunication services stayed broadly steady in July (after + 0.3% in June), but they remained in sharp decline compared with the same month one year ago (— 12.0%). Finally, if the prices of health services were still up slightly in July (+ 0.1% like in June), they slowed down compared with the same month one year ago (+ 0.7% after + 1.1% in June 2013).

In July 2013 and for the first time since March 2013, the energy prices increased (+ 0.3%; + 1.8% compared with the same month one year ago). This rebound was mainly due to the increase in prices of petroleum products (+ 0.4%; + 0.1%, year on year), higher for heating oil (+ 0.7%; + 0.3%, year on year) than for motor fuels (+ 0.4% in July; — 0.3% year on year). The gas prices increased also in July 2013 (+ 0.5%; + 4.5% year on year) while those of electricity remained stable in July 2013 (+ 4.5%, year on year).

In July 2013, the core inflation indicator (ISJ) increased by 0.2%. Thus, after having reached a historically low level in June 2013 (+ 0.3%), its annual rate of change rose significantly in July 2013 (+ 0.6%). The Harmonized Index of Consumer Prices (HICP) declined by 0.3% in July 2013 but its annual rate of change pursued its growth (+ 1.2% after + 1.0% in June and + 0.9 % in May).