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Cyprus Inflation Slows To 1.2% As Eurozone Price Pressures Ease

by THEFUTURE.TEAM

February 26, 2026

Overview Of The Inflation Landscape

The latest data from Cyprus indicates that the annual inflation rate has decelerated to 1.2% in January 2026, significantly lower than both the euro area and European Union averages. This development, reported by Cystat and Eurostat, underscores the easing of price pressures across the region.

Sectoral Dynamics Driving The Numbers

The Harmonised Index of Consumer Prices (HICP) fell from 2.9% in January 2025 to 1.2% year over year, while monthly inflation declined by 0.3%.

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The strongest annual increases were recorded in recreation, sports, and culture (+5.8%), followed by restaurants and accommodation services (+4.8%) and education (+3.4%). Food and non-alcoholic beverages rose by 3.2%, while alcohol and tobacco, health services, and personal care goods posted more moderate gains.

By contrast, clothing and footwear prices declined sharply, falling 6.2% annually and 12.1% month over month, making the category one of the largest downward contributors to the overall index.

Regional And Economic Comparisons

Across the euro area, inflation slowed to 1.7% in January, down from 2% in December, while the EU average eased to 2% from 2.3%. The figures point to a broader regional cooling trend, although price dynamics remain uneven across member states.

France (0.4%), Denmark (0.6%), Finland (1%), and Italy (1%) recorded some of the lowest annual inflation rates. At the other end of the spectrum, Romania (8.5%), Slovakia (4.3%), and Estonia (3.8%) reported significantly higher readings.

Major economies, including Germany, Spain, Greece, Portugal, Malta, and Croatia, showed mid-range inflation levels, reflecting differing domestic cost pressures across the bloc.

Inflation Drivers And Key Contributions

Energy prices played a central role in slowing inflation. In the euro area, energy costs fell by 4% year over year, while Cyprus recorded an annual energy decline of 6.5%, helping reduce overall price growth.

Services, which account for nearly half of the consumer basket, remained the main upward driver, contributing 1.45 percentage points to inflation. Non-energy industrial goods had a more limited impact, while food, alcohol, and tobacco continued to add pressure with annual growth of 2.6%.

Conclusion

The slowdown in Cyprus inflation to 1.2% reflects both domestic price stabilization and broader easing trends across the euro area. Falling energy costs are helping offset persistent service-sector pressures, reshaping the inflation profile as policymakers and investors monitor the next phase of economic adjustment.

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Cyprus Expected Working Life Reaches 39.5 Years, Above EU Average

People in Cyprus are expected to spend 39.5 years in the workforce, around two years longer than the European Union average of 37.5 years, according to the latest Eurostat data for 2025.

The figure places Cyprus among the EU countries with the longest expected working lives.

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Cyprus Ranks Above EU Average

Only a handful of member states recorded higher figures than Cyprus. The Netherlands topped the ranking at 44 years, followed by Sweden at 43.4 years, Denmark at 42.6 years, and Estonia at 41.5 years.

At the other end of the ranking were Romania with 32.7 years, Italy with 33.0 years, Bulgaria with 34.6 years and Greece with 35.3 years.

Gender Gap Remains Wider Than EU Average

Men in Cyprus are expected to remain in work for 42.1 years, compared with 36.7 years for women. The gap of 5.4 years exceeds the EU average gender gap of 4.1 years.

Across the bloc, Lithuania, Latvia and Estonia were the only countries where women were expected to spend longer in employment than men. Finland recorded the smallest positive gender gap at 0.7 years.

Italy posted the widest gap at 8.9 years, followed by Romania at 6.9 years, Greece at 6.7 years and Malta at 6.3 years.

Working Lives Continue To Lengthen

Between 2016 and 2025, expected working life in Cyprus increased by 3.5 years, placing the country among the strongest performers in the EU over the period. Men’s expected working life rose by 3.3 years, while women’s increased by 3.6 years.

Across the EU, every member state recorded an increase. Malta posted the largest gain at 4.9 years, followed by Hungary and Ireland at 4.2 years each, and the Netherlands at 4.1 years.

Malta’s increase was driven largely by women, whose expected working life rose by 7.8 years, the biggest increase recorded across the bloc.

By comparison, Romania, Spain, Italy, Germany and Austria recorded gains of two years or less over the same period.

Women’s Working Lives Increase Faster Across Europe

Women’s expected working life increased faster than men’s in most EU countries. Denmark, Romania, Sweden and Greece were the main exceptions.

In Cyprus, gains for men and women were broadly similar, alongside Bulgaria, Belgium and Slovenia.