The acceleration of rising prices, on the background of geopolitical tensions and soaring oil prices, is accompanied by a little lower than expected growth.
By
Inflation should accelerate in France in the first half of the year, to reach, in June, from 3% to 3.5% in annual slip, affirms INSEE in its point of conjuncture of Tuesday 8 February. In January, inflation was already higher than at the end of the year 2021, at 2.9% instead of 2.8%.
This acceleration of rising prices, on the background of geopolitical tensions and outbreak of oil prices, is accompanied by a little lower than expected growth. Consumption anticipates growth of 0.3% in the first quarter, instead of 0.4% expected, net withdrawal from 0.7% of the last quarter of 2021.
Growth could then be more dynamic (in the order of 0.6% expected in the second quarter), resulting in a growth acquired by 3.2% in the middle of the year.
A “little approaching” consumption
The year 2022 also started mildly on the household side, with a consumption that would be “not falling”, according to Olivier Simon’s expression, head of the cyclical synthesis division. The results of the winter balances are not yet known, but the so-called “high frequency” indicators, such as Google queries or bank card transactions, seem to show that the French have remained cautious in their expenses.
Difficult to know, at this stage, if it is a health precaution related to Omicron or if the price increase is involved. “The most bare sectors seem to us to be those who are rather affected by the health aspects, such as accommodation-restoration”, Advance Julien Pouget, Director of the Cconomist. Whoever adds that household confidence is “half-tie”, and savings balances remain “high”.
Insee also calculated the impact of the “tariff shield” on inflation: without these measures to contain the rise in the price of gas and electricity, inflation in February “would have was enhanced by at least one percentage point, “concludes the Institute, which means that it would have close or reached 4%.
Supply difficulties slowly move away
Companies, they see the procurement difficulties slowly: in October 2021, 45% of the industrial companies reported it, this figure fell to 35% in January. The number one of the business leaders is now to recruit, while the French economy has created nearly 650,000 jobs in 2021. At the beginning of the year, 77% of building companies struggled to hire, compared to 59% usually. This is also the case for 61% of manufacturing companies and 54% of service companies.
While the sanitary threat seems to move away, these recruitment difficulties are now one of the main cyclical uncertainties selected by INSEE, alongside geopolitical tensions, including “aggravation would increase energy prices again. “, and” the consequences of a tightening of monetary policies “.
Thursday, February 3, the president of the European Central Bank, Christine Lagarde, had acknowledged that inflation in the euro zone was stronger than anticipated. But the institution, which has decided to adopt a gradual approach to inflation risks, always tables a slowdown by the end of the year.