Inflation accelerated in July in France
1-year consumer price inflation: +6.1% in July
France’s consumer price inflation accelerated in July to 6.1% year-on-year after 5.8% in June, the National Institute of Statistics confirmed Friday in its final estimate, the highest level since July 1985.
One-year rise in energy prices in France: +28.5% in July
The Institute of Statistics said that energy prices continued to affect inflation figures, but with less force than in recent months, noting the acceleration in prices of services, food and manufactured goods.
Energy prices have risen in recent months as Russia’s invasion of Ukraine sparked a fever in global markets. However, oil prices have fallen a bit in recent weeks due to concerns about economic activity in China in particular.
As a result, energy prices rose 28.5% year-on-year in July after rising 33.1% the previous month.
Les prix des services ont de leur côté augmenté de 3.9% en juillet par rapport à la même période de 2021, contre 3.3% le mois précédent, et les prix de l’alimentation de 6.8% après 5,8 % Last month.
Over the course of a month, consumer prices rose 0.3% after +0.7% in June.
The harmonized consumer price index, which serves as the basis for European comparisons, rose 6.8% in one year after 6.5% in June.
The effect of inflation on your personal finances
High Inflation, Good News for Your Mortgage
If we compare the inflation figures in July with the figures of average rates observed for the same period by Crédit-Logement, the situation remains advantageous for borrowers who were able to obtain a loan despite the economic situation. According to figures from Observatoire Crédit Logement, they have benefited from an average credit rate of 1.68% (excluding insurance and cost of securities). Looking at inflation at 6.1% in July, this corresponds to a real credit rate of -4.42%. Even if we include the cost of insurance and stock, financing terms are very beneficial for those who manage to get credit.
To remember: If inflation is taken into account, credit terms are very attractive – even with higher prices.
High inflation, bad news for your savings reward
If it reduces the true cost of your mortgage, inflation weighs on your savings on the contrary. In fact, you will have to deduct the inflation amount from the bonus offered to get the real reward for your money.
With an inflation rate of 6.1%, the real rate of money wages placed on Livret A which has nonetheless shown 2% since August 1 is a negative rate: -4.2%.
board : Whether you own a Livret account, a stock market portfolio, a life insurance contract, SCPI shares, or whether you have invested directly in the properties you are renting, don’t forget to incorporate the level of inflation into the performance of your real investments.