Moderate inflation since the euro changeover

Marie Leclair, division des prix à la consommation, Vladimir Passeron, département de la conjoncture, Insee

From 2002 to 2016, consumer prices have increased by an average of 1.4% per year. Therefore, inflation is lower than in the previous 15 years (+2.1% on average from 1986 to 2001). However, the euro changeover in 2002 significantly widened the gap between actual and perceived inflation. This can be explained partly by the fact that consumers are more sensitive to changes in the price of products they buy often, as they more readily recall the most recent price in francs. Their recollection of previous prices fades over time. While the prices of such products were adjusted more significantly with the introduction of new psychological price lists in euros, price increases in the past 15 years are no larger than in the decade preceding the euro changeover.

Insee Focus
No 87
Paru le : 24/05/2017