Inflation hits 8.9% in Cyprus in August

Inflation in Cyprus increased to 8.9% last month, according to data published by the country’s statistical service on Friday, but some 100,000 Cypriot workers will be better off with the introduction of a minimum wage.

The island’s Consumer Price Index decreased 0.29 points and reached 113.34 points, compared to 113.63 points in July, with the drop in petroleum product prices being mainly responsible for the decrease.

In comparison to the CPI in July 2022, the largest change was noted in transport, which decreased 3.5%. The largest negative change was observed in oil products, which dropped 7.3%. On the other hand, agricultural goods increased 3.42% in comparison with the previous month.

As regards the economic origin, the largest changes when compared to the index of August 2021 were recorded in electricity, up 62%, and in petroleum products, up 31.6%. Per category, the largest changes were seen in housing, water, electricity, gas and other fuels, which increased 28.5% and transport, which grew 19.7%.

For the period January-August 2022, the CPI increased by 8.3% compared to the corresponding period of the previous year. The largest changes year-on-year were recorded in housing, water, electricity, gas and other fuels, with an increase of 21.2% and transport up by 18.9%.

Regarding the effect in points, compared to the Index of August 2021, the categories of housing, water, electricity, gas and other fuels and of transport had the largest effect on the change of the CPI, with 3.64 and 3.15 points accordingly.

The transport category had the largest negative effect on the change of the CPI compared to the previous month, decreasing by 0.69 points.

The most notable effect on the change of the CPI last month compared to August 2021 was made by petroleum products, up by 2.83 points, and electricity, up by 2.38 points.

The establishment of the minimum wage, set at 885 euros per month for the first six months of employment, increasing to €940 euros thereafter, will have a major impact on a quarter of the labor market, as 40,000 workers will benefit significantly, and 60,000 more will also benefit but to a lesser extent. August 31 will go down as a significant day in history as Cyprus was one of the states in the EU that had not introduced a national minimum wage.