ISTANBUL

France's annual inflation rate was 1.8% in August, slightly below market expectation of 1.9%, official figures showed on Friday from statistical office Insee's data.

Insee's provisional figures had forecast the rate to be 1.9%, after 2.3% in July.

The drop in inflation stemmed from a "very sharp slowdown in prices of energy," slowdown of electricity and the fall back of petroleum products, the bureau said.

In August, energy prices rose by 0.4% and food prices by 0.5%, while services prices hiked by 3%.

Manufacturer product prices decreased by 0.1% year-on-year, while tobacco prices jumped by 8.7%.