French inflation eased further in March as food, tobacco and energy prices slowed, official data showed Friday, fuelling hopes of interest rate cuts in coming months.
The annual rate fell to 2.3 percent, down from 3.0 percent in February, according to prtovisional figures from the INSEE statistics institute.
Food price inflation slowed sharply last month to 1.7 percent compared to 3.6 percent in February while tobacco prices increased by 10.7 percent, down from 18.7 percent in the previous month.
Consumer price rises slowed on a monthly basis to 0.2 percent in March after a 0.9 percent increase in February.
"This slowdown would be due to the slight drop in energy prices, particularly gas and petroleum products," INSEE said in a statement.
Investors are closely scrutinising inflation data across eurozone countries in hopes that the European Central Bank will start to cut rates as soon as June.
Eurozone inflation has been slowing but remains above the ECB's two-percent target, reaching 2.6 percent in February.
Data on Wednesday showed that inflation in eurozone member Spain accelerated in March to 3.2 percent, up from 2.8 percent in February.