cost of living Archives - Page 5 of 5

Morningstar DBRS keeps Cyprus at BBB, , ‘stable’ trend

25 March 2024 by Financial Mirror

Morningstar DBRS has confirmed Cyprus’ sovereign ratings at BBB (high) due to strong economic growth, but warned of exposure to geopolitical shocks and constraints from a small services sector. The stable trend balances favorable economic and fiscal developments against downside risks. Economic growth is driven by tourism, ICT relocations, and investment projects, with the Central Bank forecasting GDP growth to strengthen. Public debt has decreased, with further declines projected, and interest burden offset by favorable debt profile. Challenges include non-performing loans in the banking sector and low labor productivity. The ratings are supported by a stable political environment, sound fiscal policies, and EU membership.

Our View: Labour minister is biased against businesses

21 March 2024 by Cyprus Mail

Yiannis Panayiotou is the Minister of Labour in the Christodoulides government, known for his strong support of union interests. Over the past year, he has implemented several measures favoring workers, including increasing the Cost of Living Adjustment (CoLA), raising the minimum wage and the minimum wage in the hotel industry, introducing telework legislation, stopping outdoor work during heatwaves, drafting a law to protect workers from standing too long, extending maternity leave to five-and-a-half months, and raising the income of practising lawyers and engineers by €100. Plans for the coming year include stronger regulation of work terms and conditions, more support for working parents, tackling illegal work, extending parental leave, increasing birth allowance, and enhancing workplace safety. Despite these efforts, there is a concern about addressing the labor shortage of about 150,000 workers, especially in the hotel industry. Panayiotou aims to clamp down on illegal employment by increasing inspections by 65% and raising fines, but there are doubts about his approach to the labor market’s needs and his perceived bias against business interests.

Easing UK inflation keeps BoE on track for rate cuts later in 2024

21 March 2024 by Cyprus Mail

British inflation slowed in February, with consumer prices rising by 3.4% in annual terms after a 4.0% increase in January. This was the weakest rate of inflation since September 2021. Core inflation, which excludes energy, food, and tobacco prices, also slowed to 4.5% from 5.1% in January. Despite the moderation, Britain still has the highest rate of headline inflation among the Group of Seven advanced economies, with consumer prices having increased by more than 21% since the end of 2020. The Bank of England (BoE) has indicated that underlying inflation pressures remain too persistent for it to cut interest rates now, although it has signaled that lower borrowing costs are likely later this year. Finance Minister Jeremy Hunt mentioned that the fall in inflation could help the government with its goal of abolishing social security taxes, provided it does not lead to increased borrowing or cuts in funding for public services.

Cyprus consumer prices increase in February

15 March 2024 by Cyprus Mail

The harmonised index of consumer prices in Cyprus (HICP) increased by 2.1 per cent in February 2024 compared to February 2023. The Restaurants and Hotels category saw the largest increase of 6.1 per cent, while the Services category experienced the highest growth rate of 4.2 per cent. Month-to-month, the index rose by 0.8 per cent, with Clothing and Footwear recording a 3.4 per cent increase. The Food, Alcoholic Beverages, and Tobacco sectors marked the largest increase at a rate of 2.2 per cent. Cumulatively, from January to February 2024, there was a 2.1 per cent increase compared to the same period in the previous year, with notable changes in the Restaurants and Hotels (5.9 per cent), Alcoholic Beverages and Tobacco (3.1 per cent), and Other Goods and Services (3 per cent) categories.