Consumer prices rose 0.5% in August, giving a 12-month inflation rate of 1.2%, the lowest level since May and down from 1.3% in July. Economists polled by Reuters had forecast 1.2% on average.

The decline was driven by a sharper fall in prices for manufactured goods and to a lesser extent energy and tobacco, INSEE said.

Separately, INSEE said that producer prices rose 0.4% in July, and were unchanged over one year.