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HICP shows Cyprus deflation in December and January

19 February, 2014

The rate inflation for January decreased at a rate of -1,6%, as measured by the Harmonized Index of Consumer Prices (HICP), on the back of a -1,3% rate for December 2013, while the year-earlier rate for January 2013 had increased at 2,0%.
The Statistical Service Cystat released the monthly data that showed the fluctuations of the Index during the last three months as well as the percentage change compared with last year.
The deceleration of the inflation rate is evidently related to the downturn of the economy and slowdown in consumption, with the biggest drop recorded in the “housing, water, electricity and gas” sector, due to the reduction of rents and real estate prices, as well as the drop in utility bills, I accordance with government and parliament decision.
Despite a slowdown in almost all areas, the biggest increase in consumer prices and spending was in the “restaurants and hotels” sector, with cafes and tables often full, and reservations required for bookings.
Ultimately, this begs the question: “Crisis, what crisis?”