French supermarkets and gas stations have an answer to soaring inflation — freezing some prices for the next few months.
On Monday, French retail giant Carrefour announced that it would keep prices for more than 100 essential products unchanged for the next 100 days. The list of items includes breakfast cereal, coffee, tinned vegetables, detergent and diapers.
The retailer, which has more than 1,400 stores across France, said the freeze was part of its “anti-inflation challenge,” but added that prices could, in theory, rise again if tariffs on certain products increased.
“At a time when everything is increasing, Carrefour is stepping up its efforts to enable [customers] to preserve [their] daily life as much as possible,” Carrefour said on its website.
Consumer price inflation in France rose to 6.8% in the year to July, according to the government’s statistic office.
Carrefour’s announcement comes after E.Leclerc, another French supermarket chain, said last month that it would cap the prices on more than 230 of its essential products until early December, extending a price freeze it first introduced for 120 items in May.
In recent weeks, energy giant TotalEnergies (TOT) has also moved to shield motorists from painful price increases at the pump.
Last month, the company said it would reduce gas prices for customers across all of its French gas stations by €0.20 ($0.20) per liter compared to global market prices until the start of November, and by €0.10 ($0.10) per liter from November to the end of the year. That’s in addition to a government-funded discount on the retail price of fuel.
In April, the French government reduced the cost of gasoline and diesel by up to €0.18 ($0.18) a liter until the end of August. The subsidy rises to €0.30 ($0.30) a liter in September and October, before falling to €0.10 ($0.10) a liter for the rest of the year. It is paid to fuel producers who pass on the discount to consumers at gas stations.
“We prefer to make an immediate and direct contribution for our customers, rather than an indirect tax that would penalize our refineries,” CEO Patrick Pouyanné said in a press release.
Opposition parties have called for a tax on the bumper profits of energy companies, though the government has so far resisted the calls, according to a report by French newspaper Le Monde.
TotalEnergies reported $10.6 billion in profit during the first half of 2022, up 92% from the same period last year, as global energy prices sky-rocketed.
Prices have soared across Europe this year as countries unwound their pandemic restrictions and demand for goods soared. Russia’s invasion of Ukraine in late February pushed prices up further, sparking an energy crisis on the continent.
In July, the European Central Bank hiked interest rates for the first time in 11 years to help tame spiraling prices in countries that use the euro, including France. The rate of inflation across the eurozone hit a record high of 8.9% in July.