FRANCE MAY FINAL HICP -0.1% M/M; +6.0% Y/Y (=FLASH); APR +6.9% Y/Y

• The French final inflation print confirmed the downside surprise in the May flash, which saw HICP fall -0.1% m/m, cooling by 0.9pp to +6.0% y/y.
• Falling energy and oil prices, alongside slowing food and services inflation drove the decline in headline inflation prints. Food CPI remains elevated at +14.3%.
• Core CPI decreased by 0.5pp to +5.8% y/y; the first decline in seven months.
• As alluded to in the flash report, the deceleration in French manufactured goods by 0.5pp to +4.1% y/y and in services by 0.2pp to +3.0% y/y underpinned this core decline.
• The data confirms that French inflation is largely beyond the peak, and with services inflation easing this is positive news for the ECB as they grapple with hot services demand underpinning elevated core CPI.
• Tomorrow will see the final eurozone print, which after only a minor revision to Spanish m/m thus far should confirm flash estimates of stalling on the month and easing 0.9pp +6.1% y/y in May.
• Attention today is on the ECB policy decision, whereby the deposit rate will almost certainly increase by 25bp and the previous decision to end APP reinvestments in July will be confirmed. See the MNI preview here.