Inflation accelerates: energy price hikes push Cyprus and eurozone upward

Inflation in Cyprus accelerated sharply in April, reaching 3% compared to 1.5% in March. According to preliminary data from Eurostat, the main reason was the escalation of the conflict in the Middle East, which triggered an increase in fuel and energy prices.

After a relatively stable start to the year — 1.2% in January and 0.9% in February — the April jump became a notable signal of intensifying inflationary pressure. In annual terms, this is already reflected in the purchasing power of the population, which is estimated to have decreased by about 3% with unchanged incomes.

Across the eurozone as a whole, inflation also reached 3% in April versus 2.6% a month earlier. The largest contribution to price increases came from the energy sector, where inflation was 10.9%. This was followed by services (3%) and food, alcohol, and tobacco (2.5%).

Cyprus: pressure from energy and food

In Cyprus, the price increase proved to be multi-component. Energy rose by 8.7%, unprocessed food by 10.9%, and services by 4.1%. Meanwhile, core inflation (excluding energy and food) stood at 1.9%, indicating more moderate price growth in other sectors.

Despite government measures, including a fuel excise duty cut of 8.33 cents per liter from April 1, it was not possible to fully contain inflation. Authorities also implemented a support package for businesses, farmers, and the tourism sector, but the effect was limited amid external pressures.

Experts warn that if the current geopolitical situation persists, there is a risk of further price increases in the coming months.

Compared to other EU countries, Cyprus is at an average level of inflation: a similar figure was recorded in Latvia (3%), while higher growth is observed, for example, in Bulgaria (6.2%) and Croatia (5.4%).

Analysts note that energy remains the key driver of inflation in Europe, while price growth in the services sector is beginning to slow down, pointing to the unevenness of inflationary processes in the region's economy.