Cyprus inflation rebounds in August 2023 — driven by rising food prices

Cyprus experienced a significant rebound in inflation in August 2023, primarily attributed to the surge in food prices, effectively ending a year-long period of declining prices since its peak in July 2022 when it reached a record high of 10.6 per cent.

According to the Cyprus Statistical Service, the Harmonised Index of Consumer Prices, and consequently, the harmonised inflation rate, increased by 3.1 per cent in August 2023 compared to the same month in 2022 when it had risen by 9.6 per cent, marking the second-highest historical level.

In the previous month, July 2023, harmonised inflation had recorded the lowest annual increase since July 2021, dropping to 2.4 per cent.

Compared to the previous month, inflation rose by 1.1 per cent in August 2023, showing a slight deceleration from the 1.4 per cent monthly increase in harmonised inflation observed in July 2023 relative to June of the same year.

For the period from January to August 2023, there was a 4.4 per cent increase compared to the corresponding period in the previous year.

The categories that saw the most significant changes concerning August 2022, according to the Statistical Service, were “Food and Non-Alcoholic Beverages” at 10.4 per cent and “Restaurants and Hotels” at 5.6 per cent.

In comparison to July 2023, the category with the most considerable change was “Transport” at 3.5 per cent.

For the January to August 2023 period, the most significant changes were observed in the categories of “Food and Non-Alcoholic Beverages” (9.3 per cent), “Restaurants and Hotels” (6.6 per cent), and “Housing, Water, Electricity, and Gas” (6.4 per cent).

The most significant changes in economic categories compared to August 2022 were noted in “Food, Alcoholic Beverages, and Tobacco” at 8.8 per cent and “Energy” at -7.6 per cent.

Compared to the previous month, the “Energy” category recorded the most substantial change at 2.1 per cent.