Cypriots have yet to feel the drop in inflation pressures, as households continue to spend more money every month for food, as the cost of living still bites.
At the same time, consumers are being hit by increased mortgage interest rates.
Inflation in February retreated to 6.7%, compared to 7.1% in January but still historically high.
Commerce Ministry officials are not optimistic that the cost of living will ease, as “there is still a long way until a hike in prices is brought to a halt”.
In comments to the news site Stockwatch, the head of the ministry’s Consumer Protection Service, Constantinos Karagiorgis, said the market would gradually correct prices.
“We hope that fuel prices will either continue to drop or stabilise, reflecting the prices of other goods,” said Karagiorgis.
The head of the Cyprus Consumers’ Association, Marios Drousiotis, said: “Despite the drop in prices of some essential products, prices are still unfordable for many of our fellow citizens”.
He added: “We expect 2023 to be a much better year for consumers than the previous one.
“We should be seeing the drop in inflation reflected on prices in the market soon”.
DISY-affiliated trade union SEK’s general secretary Andreas Matsas said consumers had not felt the inflationary pressure drop because their expenses rose.
Matsas called on the Commerce Ministry to keep a close eye on petrol stations, as he claimed that oil companies are quick to raise prices but slow to bring them down when the international price drops.
The general secretary of left-wing AKEL-affiliated union federation PEO, Sotiroula Charalambous, said the decline in inflation was not enough to alleviate the pressure on households.
She argued that households are in a financial squeeze, as they have been hit by increases in interest rates by three percentage points since July.
Meanwhile, according to data from the Cyprus Statistical Services, prices of basic foodstuffs have increased more than the inflation rate.
During the first two months of the year, the price of sugar, margarine and other plant-based oils increased by 74.35%.
The price of olive oil increased by 18.58%, beef by 25.37%, lamb and goat meat by 24.47%, pork by 18.76%, fresh fish by 15.16%, and vegetables by 25.04%.
The price of pasta increased by 21.22%, rice went up by 17.09%, fresh full-fat milk by 17.91%, nuts by 12.88%, and chocolates by 11.7%.
Prices at fast food joints and takeaway services increased by 11.58%, while bakery products went up by 11.48%.
Meanwhile, fresh fruit prices dipped in the first two months by 12.58%, while women’s footwear fell by 3.92% and children’s clothing by 3.04%.
Air fares also dropped by 12.26%, while the cost of audio and visual recording devices fell by 8.42%.