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Cyprus Posts Exceptionally Low Inflation Amid Eurozone Price Easing

by THEFUTURE.TEAM

January 21, 2026

Cyprus has once again recorded one of the lowest inflation rates in the European Union, with Eurostat reporting a mere 0.1 percent annual increase in December 2025. This figure not only reinforces Cyprus’s status as the EU’s price-stability leader but also underscores a broader trend of easing price pressures across both the euro area and the wider bloc.

Cyprus: An Outlier in Price Stability

While many EU nations have experienced fluctuating inflation, Cyprus continues to operate well below both the euro area and EU averages. Alongside France, which reported an annual inflation rate of 0.7 percent, and Italy at 1.2 percent, Cyprus stands distinctively apart from economies facing more significant inflationary challenges.

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Shifting Trends in the Eurozone and EU

Across the euro area, annual inflation eased from 2.1 percent in November to 1.9 percent in December 2025, compared to 2.4 percent a year earlier. Similarly, the overall European Union inflation rate moderated to 2.3 percent from 2.4 percent the previous month, on the back of a 2.7 percent rate recorded a year ago. Such figures highlight a broad-based tempering of inflationary pressures across the region.

Sector Contributions to the Inflation Mix

A closer look at the euro area reveals that services fuel much of the annual inflation increase, contributing 1.54 percentage points. Additionally, the combined impacts of food, alcohol, and tobacco added 0.49 percentage points, while non-energy industrial goods contributed a modest 0.09 percentage points. Notably, falling energy prices subtracted 0.18 percentage points from the overall rate, further underscoring the mixed drivers behind current price trends.

Comparative Analysis: East Versus West

In stark contrast to Cyprus’s subdued inflation, eastern European countries like Romania are experiencing significantly higher inflation rates, with Romania peaking at 8.6 percent. Other nations such as Slovakia and Estonia reported rates of 4.1 percent and 4.0 percent respectively. These comparative figures offer valuable insight into the divergent inflationary environments within the EU, highlighting regional economic dynamics that policymakers continue to monitor closely.

Overall, the December figures illustrate that while a majority of EU member states witnessed a decline in annual inflation, a nuanced picture remains, with some nations showing stability or even slight increases. As the euro area navigates these turbulent economic conditions, Cyprus’s performance remains a benchmark for price stability in an ever-evolving fiscal landscape.

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EU Services Production Grows As Information And Communication Lead

by THEFUTURE.TEAM

November 10, 2026

Services production continued to expand across the European Union in August 2026, with information and communication recording the strongest annual growth. However, performance varied significantly between industries and member states, while Cyprus reported a mixed picture, with business services expanding and hospitality-related activities declining.

Information And Communication Leads Sector Growth

Compared with August 2025, services production increased by 5.9% in the euro area and 5.8% across the EU in information and communication. Transportation and storage also recorded growth, rising by 2.1% and 1.9%, respectively.

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Real estate activities increased by 1.6% in the euro area and 1.1% in the EU. Professional, scientific and technical activities grew by 1% in both areas, while administrative and support services advanced by 1.1% and 1.3%.

Accommodation and food services was the only major sector to record an annual decline, falling by 0.1% in both the euro area and the EU.

The monthly figures were more mixed. Information and communication remained the strongest performer, increasing by 1.2% in the euro area and 1% across the EU. Real estate activities rose by 0.4% and 0.9%, respectively, while transportation and storage edged up 0.1% in the euro area but declined by 0.2% in the EU.

Administrative and support services recorded modest gains of 0.2% in the euro area and 0.1% in the EU. Accommodation and food services fell by 0.3% and 0.4%, while professional, scientific and technical activities declined by 0.8% and 0.9%, respectively.

Slovakia And Greece Record Strongest Annual Growth

Romania recorded the largest monthly increase in services production, at 5.2%, followed by Malta at 1.8% and Portugal at 1.7%. Luxembourg experienced the steepest decline, with output falling by 5.1%, followed by Bulgaria at 2.3% and Denmark at 1.9%.

On an annual basis, Slovakia led with growth of 10%, followed by Greece at 9.3% and Malta at 7.5%. Hungary recorded the weakest performance, with services production declining by 5.6%. Denmark fell by 5.3%, while Italy recorded a smaller decrease of 0.3%.

Cyprus Sees Growth In Business Services But Weakness In Hospitality

Cyprus’ latest figures show a similar divide between expanding business services and weaker hospitality-related activities. According to the Statistical Service of Cyprus (Cystat), professional, scientific and technical activities recorded the strongest annual growth among the covered sectors in the second quarter of 2026, increasing by 3.4%.

Transportation and storage and information and communication both grew by 2.1%, while real estate activities rose by 1.6%. In contrast, accommodation and food services declined by 3.1% year on year, and administrative and support services fell by 2.2%.

First-half results were more favourable for several sectors. Between January and June, professional, scientific and technical activities grew by 3.5%, transportation and storage by 2.8%, real estate by 2.1% and information and communication by 1.3%.

Nevertheless, administrative and support services contracted by 1% over the six-month period, while accommodation and food services declined by 0.7%.

How Cyprus’ Figures Differ From Eurostat’s Data

The Eurostat and Cystat figures measure different aspects of economic activity and are not directly comparable. Eurostat’s services production index tracks changes in the volume of output, whereas Cystat’s Turnover Value Index for Services and Transport measures the value of sales at current prices.

The reporting periods also differ: Eurostat’s figures cover August, while the cited Cypriot data relate to the second quarter and first half of 2026.

Cystat transmits services production data to Eurostat but does not yet publish a separate national production index. Turnover figures therefore remain the main publicly available national indicator for the sector.

Taken together, the data point to continued growth in several of Cyprus’ business-oriented services, alongside persistent pressure on accommodation, food and administrative support activities.