Despite a statistical easing in headline inflation for July, Cyprus continues to grapple with a cost of living crisis, particularly in food and agricultural products, official data and consumer group reports show.
The Cyprus Statistical Service reported that the inflation index for food and non-alcoholic beverages rose 3.57% year-on-year in July, while agricultural products saw a 6.67% increase. High temperatures have been cited as a factor affecting production and prices.
The Cyprus Consumers’ Association revealed significant monthly price hikes, with fresh fruits and vegetables showing a 20% increase, followed by potatoes at 17%. In the services sector, organised holidays abroad, airline tickets, and hotels saw increases of 15%, 12%, and 10% respectively.
Over the past year, olive oil prices surged by 62%, fresh vegetables by 20%, and organised holidays abroad by 17%. Sugar prices, however, decreased by 26%.
The government’s support measures, including zero VAT on essential food items until September 30, 2024, have helped curb even steeper price rises, analysts say.
Electricity prices fell 3.18% year-on-year, partly due to a tiered subsidy measure. However, fuel prices increased 4.12% annually following the end of a consumption tax reduction measure.
Experts emphasise that while inflation may be slowing, it does not indicate falling prices, merely a slower rate of increase. They note that inflation and cost of living, while related, are distinct concepts affecting consumers differently based on income levels.
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