Overview
- France’s preliminary December CPI rose 0.8% year on year, with HICP at 0.7% and a 0.1% monthly gain.
- Energy costs drove the French slowdown, while services inflation held at 2.2% and food quickened to about 1.7%.
- Consensus sees Germany’s December HICP near 2.2% and headline CPI near 2.1%, with attention on core after November’s 2.7%.
- Traders continue to price no ECB rate changes for 2026, and market reaction has been muted with EUR/USD little changed.
- INSEE will rebase France’s CPI to a 2025 reference year from January 2026, a shift that can mechanically lower annual rates.