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UPDATE 1-French consumer prices fall on oil, tourism

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* Economists expected prices to remain flat in September

* Driven by falls in tourism, energy, telecoms prices

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PARIS, Oct 11 (Reuters) - French consumer prices fellunexpectedly at the end of the summer tourist season inSeptember and easing energy prices drove a fall in annualinflation that if it continues could help the European CentralBank cut interest rates.

Prices in the euro zone's second largest economy fell by 0.3percent month-on-month, compared to expectations of a flatfigure while annual inflation was 2.2 percent on an EUharmonized basis, down from 2.4 percent in August.

A Reuters poll of 19 analysts had forecast 2.5 percent. <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ For a table of figures click ) For a graphic of French inflation ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>

The ECB held off with any further reduction in interestrates this month as above-target inflation countered concernsover the euro zone's struggling economy.

Inflation in Germany is set to fall back in line with its 2percent target in September, but an easing of pressures inFrance would help.

"We were expecting a correction in inflation in September.This was a little bit larger than expected, but not enormouslyso," said Fabrice Montagne of Barclays Capital in Paris.

Excluding seasonal variations, consumer prices wereunchanged month-on-month, after rising 0.5 percent in August.

September's monthly price fall, which followed 0.7 percentrise in August, was driven by a 1.5 percent decline in the costof services.

Tourist lodging prices tumbled 42 percent month-on-month,while package tours fell 27.9 percent and airline ticketsdecreased by 15.5 percent.

Telecoms prices fell sharply in September -- slipping 3.7percent month-on-month and 12 percent on an annual basis --after new mobile phone pricing kicked in.

Energy prices slipped by 0.3 percent in September,reflecting a dip in petroleum prices, but were still up 5.8percent year-on-year.

A spike in the cost of fresh produce, particularly fish andvegetables, pushed up food prices by 0.2 percent in Septembermonth-on-month and by 2.4 percent year-on-year.

(Reporting by Daniel Flynn; editing by Patrick Graham)

Keywords: FRANCE ECONOMY/CPI