French Inflation Holds Steady at 0.8% in November, Defying Predictions as Consumer Spending Rises

Inflation Stability Surprises Economists

French harmonized inflation (HICP) unexpectedly held steady at 0.8% year-on-year in November, according to preliminary data released by the national statistics office INSEE. This figure remained unchanged from October and defied economists' predictions of an increase to 1.0%. Similarly, the national Consumer Price Index (CPI) also maintained a steady annual rate of 0.9% in November, matching the previous month's performance.

The stability in the overall inflation rate can be attributed to a mix of decelerating prices in certain sectors and slight accelerations in others. A significant factor was the slowdown in service prices, particularly communication services, and a more pronounced decline in manufactured goods prices.

Key Price Movements

A detailed breakdown of the November inflation data reveals several contributing factors:

• Services inflation softened to 2.2%, down from 2.4% in October.
• Manufactured product prices saw a decrease of 0.6%, following a 0.5% fall in the prior month.
• These downward pressures were partially offset by a more moderate decrease in energy prices, which fell by 4.6% compared to a 5.6% decline previously.
• Food inflation edged up slightly to 1.4% from 1.3% in October.

On a monthly basis, consumer prices edged down 0.1% in November, offsetting October's 0.1% rise. The harmonized index of consumer prices also slid 0.2% month-on-month.

Consumer Spending Shows Resilience

In a related economic development, French household consumption of goods demonstrated a notable increase. In October 2025, household spending on goods rose by 0.4% in volume on a monthly basis, following a 0.3% increase in September. This rebound in consumer spending surpassed economists' forecasts, which had anticipated a 0.3% gain.

This rise in consumption was driven by increases across various categories, indicating a resilient consumer base despite ongoing economic uncertainties. The French economy also saw accelerated growth in the third quarter of 2025, with GDP expanding by 0.5%, confirming earlier estimates.

Broader Economic Context

The stable inflation figures for France are being closely watched by the European Central Bank (ECB), as they contribute to the overall eurozone inflation picture. The ECB is widely expected to maintain its current interest rates, with the latest French data reinforcing expectations that rates could remain unchanged well into the next year.