Inflation and Purchasing Power: It’s the Politics, Stupid![Inflation et pouvoir d’achat : It’s the politics, stupid !]

Purchasing power will remain the defining issue at the start of the new five-year presidential term. Closely linked to soaring inflation, the topic will be the subject of a bill examined by the National Assembly in the height of summer. Although France has been less affected than some of its European neighbors, the question arises as to whether we are facing sustained inflation or merely temporary relative price movements. After a necessary historical overview to better understand the issue, the authors of this brief show that inflationary episodes have not always been accompanied by a decline in purchasing power. What are the causes of inflation? How should it be addressed in the current monetary context? What should we think of the various measures recently adopted by the government — including the "energy shield" - to protect consumers from soaring bills? The authors shed new light on how to safeguard the purchasing power of the French, a genuine priority.