Steady Inflationary Signals
In a decisive report issued by Cyprus’ state statistical service (Cystat), the Harmonised Index of Consumer Prices (HICP) for December 2025 reveals a notably subdued inflation environment. The index showed an annual increase of just 0.1 percent relative to December 2024, while recording a monthly decline of 0.4 percent compared to November 2025.
Yearly Overview and Sector Dynamics
Throughout the 2025 calendar year, consumer prices registered a marginal rise of 0.8 percent over the same period in the previous year. Among the sectors exerting upward pressure, the leisure and hospitality segments led with notable increases. Specifically, recreation and culture prices surged by 5.1 percent, while restaurants and hotels saw a 4.4 percent rise on an annual basis.
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Conversely, the data highlighted notable price reductions in key areas. Clothing and footwear experienced a significant decline of 7.9 percent, while the housing sector—encompassing water, electricity, and gas—fell by 3.2 percent. This mixed sectorial performance underscores the varying demand dynamics across consumer categories.
Monthly Trends and Economic Implications
The month-on-month analysis for December 2025 against November 2025 further underscores the predominantly tepid inflationary pressures. Transport costs depreciated by 1.7 percent, and the restaurants and hotels segment continued its downward trend with a 0.9 percent decline. Notably, over the full year, clothing and footwear prices dropped by 6.4 percent, while energy costs eased, decreasing by a substantial 5.4 percent, thus dampening broader inflation metrics.
Conclusion: A Balanced Economic Outlook
Taken together, these figures indicate that while consumer-facing services—particularly in the leisure and hospitality sectors—saw some price increases, the overall inflationary landscape in Cyprus at the end of 2025 remained controlled. The interplay of price fluctuations between services and goods, combined with easing energy prices, suggests a carefully balanced economic environment heading into the new year.
