Cyprus inflation rises by 1.8 per cent in February

Cyprus saw a modest inflation increase of 1.8 per cent in February 2024, a development primarily driven by the services sector, according to a report released on Thursday by the Cyprus Statistical Service (Cystat).

Interestingly, this uptick follows a notable de-escalation in inflation rates observed in the preceding months, with decreases recorded in November and December 2023, as well as January 2024.

Despite this recent increase, it’s important to note that inflation remains below the European Central Bank’s target of 2 per cent for the Eurozone, indicating a relatively stable economic environment.

According to the report, consumer price inflation (CPI) in February 2024 rose by 1.03 points, reaching 114.93 points compared to 113.90 points in January 2024. This change is significant when considering the trend of inflation in recent months.

Specifically, inflation in November 2023 saw a substantial drop, falling to 1.71 per cent on an annual basis from 3.47 per cent the previous month.

Similarly, trends observed in December 2023 and January 2024 showed increases of 1.64 per cent and 1.69 per cent, respectively.

For the January and February 2024 period, the CPI recorded a 1.8 per cent increase compared to last year. Delving deeper into the data, Cystat highlights that the largest change in economic categories year-over-year in February was in Services, with an increase of 3.7 per cent.

Moreover, compared to the previous month, the most significant change was in Agricultural Products, which rose by 5.6 per cent.

Focusing on a more detailed analysis of percentage changes, it’s revealed that, compared to February 2023, the greatest change was seen in the Restaurants and Hotels category, which surged by 6.2 per cent.

On the other hand, compared to January 2024, the largest changes were observed in the Clothing and Footwear (3.1 per cent) and Food and Non-Alcoholic Beverages (2.7 per cent) categories.

For the January and February 2024 timeframe, when compared to the same period last year, the most notable changes were in Restaurants and Hotels (5.9 per cent) and Other Goods and Services (3.7 per cent).

Furthermore, the categories that had the most significant positive impact on the CPI change in February 2024, compared to February 2023, were Restaurants and Hotels (0.62) and Food and Non-Alcoholic Beverages (0.43).

In contrast, the categories with the greatest impact on the CPI change compared to the previous month were Food and Non-Alcoholic Beverages (0.60) and Clothing and Footwear (0.22).

The report also showed that the most substantial impact on the CPI change in February 2024, compared to February 2023, came from Catering Services (0.60).

Lastly, Fresh Vegetables (0.38) had the most significant impact on the CPI change in February 2024 compared to the previous month, underscoring the volatility in specific sectors that contribute to the overall inflation dynamics in Cyprus.