Economy

EC revises Cyprus GDP growth forecast upwards for 2024-2025

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EC revises Cyprus GDP growth forecast upwards for 2024-2025

The European Commission has published its Winter 2024 Economic Forecast, which lowers the growth outlook for this year and sets inflation on a lower downward path than projected last autumn. In Cyprus, real GDP growth slowed down to 2.5% in the first three quarters of 2023 compared to 5.8% for the same period in 2022. However, demand for tourism services continued to rebound in 2023, with arrivals increasing by 20.1%. Private consumption remained robust, supported by real wage increases and employment growth. For the whole of 2023, economic activity is expected to have grown by 2.4%. In 2024 and 2025, real GDP in Cyprus is expected to grow by 2.8% and 3% respectively. Harmonized index of consumer prices (HICP) inflation in Cyprus is set to moderate to 2.4% in 2024 and 2.1% in 2025.

Explainer: European banks and their $1.5 trillion commercial property headache

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Explainer: European banks and their $1.5 trillion commercial property headache

European banks have approximately 1.4 trillion euros (.50 trillion) in loans to the troubled commercial property industry. German banks, in particular, are heavily exposed due to the country’s worst real estate slump in decades. Commercial property prices have dropped in Germany and across the euro area. Deutsche Bank has the most outstanding loans to the sector among German banks, followed by two state-backed Landesbanken. Deutsche Pfandbriefbank (PBB), one of Germany’s top property financiers, has 5 billion euros tied up in the U.S. commercial market. The outlook for the real estate market is bleak, with experts predicting a continuing downturn.

Ukraine needs $486 bln to recover, rebuild after nearly two years of war – World Bank

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Ukraine needs $486 bln to recover, rebuild after nearly two years of war – World Bank

Rebuilding Ukraine’s economy after Russia’s invasion is expected to cost 6 billion, which is 2.8 times its expected economic output in 2023. This estimate covers the period from the invasion in 2022 through the end of 2023 and includes the direct physical damage to infrastructure, the impact on people’s lives and livelihoods, and the cost to “build back better.” The estimate has increased from 1 billion last year. The report identifies housing needs as the highest priority, followed by transport and commerce and industry. The direct damages from the war have reached almost 2 billion, with losses concentrated in certain regions. Disruptions to economic output and trade, as well as other war-related costs, are expected to add another 9 billion. The report highlights the urgent need for billion to cover repair, recovery, and reconstruction priorities in 2024. The Ukrainian government has already allocated some funds for this purpose and plans to undertake various reforms. Despite the war, the Ukrainian economy has shown resilience, with foreign direct investment flowing into the country. The number of displaced Ukrainians has decreased compared to previous assessments.

Inflation hits Valentine’s Day goods

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Inflation hits Valentine’s Day goods

The data collected by CyStat for January 2024 shows that prices of basic products and services on Valentine’s Day have increased compared to last year. The largest increase is in jewellery prices at 9.7%, followed by hotel and motel prices at 9.5%. Other increases include chocolates at 7.7%, hair salon prices at 6.3%, personal care treatments at 5.7%, restaurant and café prices at 5.6%, plants and flowers at 5.2%, and confectionery items at 3.8%. Smaller increases were recorded for wine prices, women’s clothing, men’s clothing, and watches. Prices at cinemas, theatres, and concerts dropped slightly, while stationery prices decreased by 3.4%.

ANALYSIS-Indonesia’s Prabowo poised for power, but how will he rule?

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ANALYSIS-Indonesia’s Prabowo poised for power, but how will he rule?

Prabowo Subianto, the former Defence Minister of Indonesia, has taken a commanding lead in unofficial results from Wednesday’s election, making him the presumed next president of Indonesia. His victory is met with a mixture of elation and anxiety, as he is a polarizing figure. One major question is how long his alliance with outgoing President Joko Widodo will hold. Prabowo has aligned himself with Widodo’s policies during the campaign, but analysts say that policy continuity is not guaranteed. Prabowo is from an elite family and was dismissed from the military in 1998 amid allegations of human rights abuses. He has campaigned on a platform of “Developing Indonesia” and promises to achieve 7% economic growth. A Prabowo government would likely play a bigger role in the economy and follow the pragmatism of previous Indonesian presidents. However, concerns about Indonesia’s democratic regression have been raised, as Prabowo has discussed abolishing presidential term limits and ending direct elections.

Yachting sector poised for growth

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Yachting sector poised for growth

The yachting sector is expected to grow in Cyprus and internationally in 2024. Nikiforos Pampakas, the general manager of Limassol Marina, stated that Cyprus is becoming an attractive destination for yachts and recreational boats. The expansion of berth capacity at the marina will allow for more vessels and contribute to the sector’s positive impact on the economy. Pampakas mentioned that the volume of activity at the marina and positive feedback from other tourism sectors are reasons for optimism. He also noted that the Limassol Marina, which is approaching its tenth anniversary, aims to maintain its status as a premier destination by continuing to offer high-quality services.

CPI kills last hope for March Fed rate cut

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CPI kills last hope for March Fed rate cut

The U.S. inflation report for January showed higher-than-expected inflation across the board. The headline and core monthly readings were 0.3%, while the annual readings were 3.1% and 3.9% respectively. This data has decreased the likelihood of a rate cut in March and has caused a shift in market expectations. Previously, there were expectations of a rate cut and 175 basis points of rate cuts priced in for this year, but now only 75 basis points are priced in. The strong economy and low inflation scenario is now seen as unlikely. The inflation report also had an impact on gold and bitcoin prices. Gold fell below ,000 and bitcoin’s climb above ,000 was halted.

A step in right direction for UK, BoE cautious

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A step in right direction for UK, BoE cautious

The text discusses the progress of the UK in cutting interest rates and the challenges involved in doing so. It mentions that wage growth is slowing, but it is uncertain if it will fall to a level consistent with 2% inflation. The unemployment rate has fallen to 3.8%, but it is no longer a reliable indicator. The Bank of England is relying on various data and surveys to make judgments about the labor market. The text also briefly mentions oil prices, gold prices, and the milestone of bitcoin breaking above ,000.

Is it worth investing in gated projects?

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Is it worth investing in gated projects?

Gated projects in Cyprus have become increasingly popular due to the rising crime rates and the need for increased security. These projects offer a sense of added security and privacy, discourage unwanted visitors and traffic, and can be equipped with cameras for added security. However, there are some drawbacks, including the initial cost and maintenance expenses, the potential for visitors or maintenance workers to bypass the gate, and the inconvenience of being locked out if the gate malfunctions. The article suggests a suitable system for gated projects, including an electrically controlled gate with a code and remote control, an intercom system, a manual override in case of power failure, and a sensor for automatic opening. The author also advises homeowners to consider additional security measures such as aluminum shutters and burglar alarms. Overall, gated projects provide added security but come with some challenges.