**Cyprus Inflation Rises as Services Sector Drives Consumer Prices Up**
In a recent report by the statistical service Cystat, the Cyprus consumer price index (CPI) saw an increase in February, with figures rising from 113.90 in January to 114.93, marking a 1.03 point uptick. The inflation rate correspondingly climbed by 1.8% compared to February of the previous year, predominantly influenced by the services sector.
The CPI rate experienced a 0.9% increase from January and was 1.75% higher for the first two months of the year, compared to the same period in the preceding year. Services recorded the most significant change with a 3.7% rise as of February 2023.
Agricultural goods also witnessed a notable shift, with a 5.6% increase compared to the previous month. When focusing on specific categories, restaurants and hotels topped the list with a 6.2% change compared to February 2023.
The sectors of clothing and footwear, along with food and non-alcoholic beverages, saw the largest changes from January, increasing by 3.1% and 2.7%, respectively. Over the span of January to February, restaurants and hotels, and miscellaneous goods and services underwent the largest changes, recording 5.9% and 3.7% increases compared to the same timeframe last year.
On a year-on-year basis for February, the most substantial price hikes were observed in restaurants and hotels (0.62 points) and food and non-alcoholic beverages (0.43 points). Catering services exerted a considerable influence on the CPI change for February, with a 0.60 point impact when compared to the same month in the previous year. Fresh vegetables also played a significant role, contributing a 0.38 point effect on the CPI change from January this year.
Cystat’s methodology for calculating the monthly CPI includes a weighted distribution across four districts: Nicosia at 42%, Limassol at 30%, Larnaca at 18%, and Paphos at 10%. The prices of 805 goods and services are monitored monthly, with some exceptions like seasonal products, meat, and fuels, which are checked weekly.
This inflationary trend reflects the ongoing economic adjustments within Cyprus, as various sectors adapt to changing market conditions. Businesses and consumers alike are keeping a watchful eye on these developments as they plan for the year ahead.
