Cyprus has concluded 2025 with a persistent downward trend in consumer prices, marking the eighth consecutive month of deflation. According to the latest data from the Statistical Service of Cyprus, the Consumer Price Index (CPI) for December 2025 dropped by 0.5% compared to the same month in 2024.
While the year-on-year figures remain in negative territory, the month-to-month data showed a slight uptick. In December, the CPI edged up by 0.1% (0.10 points), rising to 117.67 units from 117.57 in November. For the entirety of 2025, the average price level remained nearly flat, seeing a marginal increase of just 0.1% compared to 2024.
Sector Spotlight: What Cost More (and Less) in December
The deflationary pressure was largely driven by significant drops in energy costs and certain consumer goods, which offset rising prices in the services sector.
Annual Price Changes (Dec 2024 vs. Dec 2025)
| Category | Change (%) | Primary Drivers |
| Electricity | -9.4% | Lower utility costs |
| Clothing & Footwear | -7.9% | Retail competition/discounts |
| Agricultural Products | -5.8% | Supply stabilization |
| Food & Non-Alcoholic Beverages | -2.9% | Broad grocery relief |
| Education | +3.5% | Tuition and material hikes |
| Restaurants & Hotels | +4.9% | High hospitality demand |
Key Economic Impacts and Monthly Fluctuations
The “tug-of-war” between various economic categories defined the final month of the year:
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The Service Sector Pull: Services overall saw a 3.1% annual increase. Within this, catering services had the single largest positive impact on the index (+0.53 units).
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Energy and Fresh Produce Relief: The biggest downward force came from electricity (subtracting 0.53 units from the total index) and fresh vegetables (-0.51 units).
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The December Rebound: Despite the annual drop, prices for fresh vegetables actually jumped significantly in December compared to November, contributing a +0.33 unit positive impact to the monthly change. Conversely, airfares and electricity both dipped slightly month-on-month (-0.06 units each).
2025: The Full-Year Perspective
Looking at the cumulative data from January to December 2025, the Cypriot economy experienced a period of extreme stability with a hint of sector-specific inflation.
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Highest Annual Growth: Hospitality (Restaurants and Hotels at +4.7%) and Education (+3.7%) remained the most expensive areas for consumers.
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Deepest Annual Decline: The clothing and footwear sector remained the “deflation champion” for the year, with a total decrease of 6.5%.
Source: Stockwatch.com.cy