In France, inflation slowed more than expected in August. The consumer prices (HICP) determined using the European method increased by 6.5 percent compared to the same month last year, as reported by the Insee statistics office in Paris on Wednesday. In the previous month, the rate was 6.8 percent. Analysts had expected a slight decline to 6.7 percent. Despite the slowdown, the cost of living continues to rise at an unusually high rate.
The French economy, meanwhile, has grown again. In the second quarter, economic output (GDP) increased by 0.5 percent compared to the previous quarter. Insee thus confirmed already known data. Both the domestic economy and foreign trade contributed to the growth. In the first quarter, the second-largest economy in the eurozone had shrunk slightly.
In view of the high inflation and the still solid economic situation, the European Central Bank (ECB) is heading for another significant interest rate hike. A rate hike of 0.5 percentage points, possibly even 0.75 points, is expected for the next monetary policy meeting in the coming week. In contrast to France, inflation in Germany has recently increased according to figures from Tuesday. (dpa)