May's consumer price index showed no change on the month after a 0.5 percent increase in April. Energy prices dropped 1.2 percent in May, mainly due to a 2.4 percent decline in petroleum product prices, which balanced out a 0.4 percent rise in food prices, driven by a 2.9 percent surge in fresh produce costs. Manufactured goods and service prices each saw modest increases of 0.1 percent, while tobacco prices remained unchanged. When seasonally adjusted, consumer prices were also flat in May following a 0.5 perecent rise in April.

On an annual basis, consumer prices increased by 2.3 percent in May, up from 2.2 percent in April. This slight rise was due to higher energy prices, which jumped from 3.8 percent in April to 5.7 percent in May, along with a 2.9 percent base effect increase in petroleum product prices. Food prices edged up by 1.3 percent year-over-year, while service prices grew at a slower rate, from 3 percent to 2.8 percent, and tobacco prices also slowed, from 9 percent to 8.7 percent year-on-year. Manufactured goods prices remained stable.

The harmonised index of consumer prices increased by 0.1 percent month-over-month, down from 0.6 percent in April, and rose by 2.6 percent year-over-year, up from 2.4 percent. The variation between HICP and CPI is attributed to changes in health sector reimbursements and energy prices.

No revisions are expected to the provisional data leaving a flat monthly CPI and a 2.2 percent annual inflation rate, the latter also unchanged from April's final post.

The consumer price index (CPI) is a measure of the average price level of a fixed basket of goods and services purchased by consumers. Monthly and annual changes in the CPI represent the main rates of inflation. The national CPI is released alongside the HICP, Eurostat's harmonized measure of consumer prices. A flash estimate was released for the first time in January 2016 and is now published towards the end of each reference month.

The consumer price index is the most widely followed indicator of inflation. An investor who understands how inflation influences the markets will benefit over those investors that do not understand the impact. In countries where monetary policy decisions rest on the central bank's inflation target, the rate of inflation directly affects all interest rates charged to business and the consumer. As a member of the European Monetary Union, France's interest rates are set by the European Central Bank.

France like other EMU countries has both a national CPI and a harmonized index of consumer prices (HICP). The HICP is calculated to give a comparable inflation measure for the EMU. Components and weights within the national CPI vary from other countries, reflecting national idiosyncrasies.

Inflation is an increase in the overall prices of goods and services. The relationship between inflation and interest rates is the key to understanding how indicators such as the CPI influence the markets - and your investments. As the rate of inflation changes and as expectations on inflation change, the markets adjust interest rates. The effect ripples across stocks, bonds, commodities, and your portfolio, often in a dramatic fashion.

By tracking inflation, whether high or low, rising or falling, investors can anticipate how different types of investments will perform. Over the long run, the bond market will rally (fall) when increases in the CPI are small (large). The equity market rallies with the bond market because low inflation promises low interest rates and is good for profits.