France’s annual inflation rate fell to 0.8% in December 2025, its lowest level in seven months, down from 0.9% in each of the previous two months and below expectations of 0.9%, according to preliminary estimates. The easing in inflation was mainly driven by a sharper decline in energy prices (-6.8% vs -4.6%), particularly for petroleum products. By contrast, food price inflation accelerated (1.7% vs 1.4%), largely reflecting higher prices for fresh products. Prices of manufactured goods continued to decline, albeit at a slower pace (-0.4% vs -0.6%), while inflation in services (2.2%) and tobacco (4.1%) remained unchanged. On a month-on-month basis, consumer prices edged up by 0.1% after a 0.2% decline in November, undershooting expectations of a 0.2% increase. The rise was driven by a seasonal rebound in service prices, particularly in transport. In EU-harmonised terms, inflation fell to 0.7% year on year, below forecasts of 0.8%, while prices rose by 0.1% month-over-month.

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