The eurozone has experienced high year-on-year inflation each month for several years, and while France was by no means hardest hit there is widespread relief as prices begin to stabilise.
The invasion of Ukraine in February 2022 sparked an energy crisis as Europe sourced alternatives for Russian gas, causing prices to rise in many EU countries, according to a March 2023 report to the EU’s Economic Governance Committee.
“The sheer expectation of future shortages (especially in natural gas)... contributed to a significant increase in energy prices.”
The invasion also caused food prices to rise as alternatives were sought for Ukrainian grain
Eurozone price rises stabilise
Visactu / The Connexion
Energy prices across the eurozone have been in recovery from the initial shock of the invasion since the spring of 2023. By October of that year, they were returning to their natural levels, falling year-on-year by -11%.
The price of energy has continued to fall into 2024 (-1.8% year-on-year in March 2024).
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However, prices are still rising in other sectors, in particular food (up 2.7% year-on-year) and services (up 4% year-on-year).
These rising prices do not affect all eurozone countries equally. France, in particular, was shielded from the soaring energy costs by the government's price shield.
This measure was finally withdrawn in January 2024, with Minister of Public Accounts Thomas Cazenave telling Franceinfothat the falling prices would “allow us to progressively increase taxes.”
“We need to take better care of public finances,” he added.
“Inflation was amplified by market speculation on energy and food prices, and most companies got away with increasing their prices without increasing wages,” announced the CGT General Confederation of Labour union.
