The rate of inflation continued on a downward path in December, according to the Consumer Protection Service which monitors the prices of consumer products.

Inflation in December was down to 1.6 per cent slightly lower than November (1.7 per cent) and this was attributed to reduced energy and foodstuff costs; it was 4 per cent in September and 3.5 per cent in October.

The Service’s price observatory, calculates the average weighted price for 250 consumer products, based on the quantities an prices at which these were sold, each day of the month, in 400 retailers all over the island.

According to Cyprus Statistical Service (Cystat) data, inflation in the food sector for January to December 2023 rose to 7.74 per cent, compared to 8.14 per cent from January to November. This decrease is attributed to a 4.33 per cent fall in prices of agricultural products and a 5.32 per cent fall in the price of petroleum products.

Among the 45 basic food product categories analysed, 29 recorded a decrease, with frozen pasta leading at 8.2 per cent, followed by flour at 7.3 per cent, vegetables at 5.5 per cent, eggs at 5.1 per cent, Cyprus coffee at 4.6 per cent, yoghurt at 3.9 per cent, juice at 3.8 per cent, baby food at 3.6 per cent, and oil at 5.8 per cent. Conversely, 16 categories saw an increase, with frozen shellfish rising by 5.6 per cent, cold meat by 4.1 per cent, cheese by 2.7 per cent, and sugar by 3.8 per cent.

The consumer protection service shows that due to the zero Value Added Tax (VAT) rate on selected products, there is an 11 per cent difference in prices between the most and least expensive baskets. Specifically, the comparison stands at €189.80 versus €171.49, with the middle basket priced at €182.93. The implementation of the zero VAT rate, in effect since December 1, 2023, provides consumers with a benefit ranging from €6.94 to €7.11 on approximately €85 worth of purchases. This includes 11 specified products, such as meat and vegetables.

Furthermore, monitoring efforts across nine different supermarkets, involving 58 points of sale throughout Cyprus, indicate a positive impact on prices and inflation. Findings from audits conducted on January 12, 2024, reveal a worldwide compliance rate for products such as milk, eggs, vegetables, sugar, and coffee, ranging between 85 per cent and 90 per cent. However, compliance percentages for other products are lower.