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France’s annual inflation rate held steady in April, defying a broader uptick in eurozone price growth expected this month.

Year on year consumer prices were stable at 1.4 per cent this month in the eurozone’s second largest economy. The stabilisation comes as consumer price growth in neighbouring Germany climbed back up to 2 per cent and is forecast to leap to 1.8 per cent across the wider eurozone in April.

Separate figures on French GDP out earlier this morning show a slowdown in growth momentum in the economy at the start of a year which has been marked by the country’s most unpredictable election in the post-war era. Quarterly GDP expansion fell to 0.3 per cent from 0.5 per cent, as consumer spending slowed significantly.

Official figures from Insee show consumer declined unexpected by 0.4 per cent in March after a 0.7 per cent contraction in the previous month. Economists had expected spending to rebound by 0.5 per cent.

Speaking at his latest monthly press conference yesterday, ECB president Mario Draghi repeated the central bank’s forecast that underlying inflationary pressures remain weak across the eurozone.

Despite signs of more robust growth at the start of the year, the ECB is still unconvinced that the current volatile price rises can be sustained to hit its average target of just under 2 per cent.

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