Cyprus inflation climbs in April

Food, medicines and petrol bite

The national consumer price index rose by 1.77% over the year-earlier period in April, compared with 1.49% in March, recording its highest rate of increase since September.

The main reason for the increase was a 6.56% year-on-year spike in the price of food. This is a heavily weighted category and also recorded a sharp increase compared with the previous month, of 1.16%.

Healthcare products also rose sharply, by 2.64% compared with April 2006. It seems that retailers are now clawing back the government-imposed cut in prices in March 2005 that also led to a strong increase in demand.

The Statistical Service also reported that the prices of petroleum products rose.

This will have affected the price of transport, which rose by 1.71% year on year in April according to the index. After falling in late 2006, international oil prices have started to climb again.

When the EU authorities make their assessment about whether Cyprus has met the inflation criterion for adopting the euro, they will use a different inflation rate, the EU-harmonised consumer price index (HICP).

This increased slightly to 1.4% in March (latest figures) but was still within the euro target.

Fiona Mullen