Energy prices tip French inflation above 2pc

13th October 2005, Comments 0 comments

PARIS, Oct 13 (AFP) - Annual inflation in France reached 2.2 percent in September as increases in energy costs begin to trickle through into consumer prices, mirroring a similar trend in neighbouring countries, data from France's national statistics agency INSEE showed on Thursday.

PARIS, Oct 13 (AFP) - Annual inflation in France reached 2.2 percent in September as increases in energy costs begin to trickle through into consumer prices, mirroring a similar trend in neighbouring countries, data from France's national statistics agency INSEE showed on Thursday.

The 2.2-percent rise in prices in September -- compared with the same month a year earlier -- was the first time this year that annual inflation had surpassed the 2.0 percent target rate of the European Central Bank (ECB), giving further impetus to calls for a rise in eurozone interest rates.

Consumer prices increased by 0.4 percent in September compared with August, INSEE said.

Annual inflation in the 12-member eurozone was 2.5 percent in September, according to the latest figures from the EU. Inflation is running at the same level in Germany, the biggest economy in the eurozone.

In France, an increase in energy costs, underpinned by the surge in crude oil prices this year, was the main reason for the rise in annual inflation, which accelerated in September after a reading of 1.8 percent in August, analysts said.

Nicolas Bouzou, an expert at economics consultancy Xerfi, said that energy products accounted for "half of the overall rise in prices". Jean Claude Trichet, the head of the ECB, speaking in the Russian city of Saint Petersburg on Thursday, said policy makers had to remain "strongly vigilant" to control the inflationary effects of oil.

"We are living in a world with a lot of uncertainties and one of these uncertainties is oil prices," Trichet told reporters at a press conference.

Copyright AFP

Subject: French news

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