Cyprus poses as an exception in Europe’s inflation trends, with its annual rate reaching 0% in September 2025, according to Eurostat’s preliminary estimates. At a time when the euro area faces a moderate yet steady inflation rate of 2.2%, Cyprus stands out as the only country with no year-on-year price change, while its monthly inflation even registered a decline of -0.4%.
This contrasts sharply with broader European trends, where sectors like services (3.2% in the eurozone) and food (3%) continue to drive price pressures. In Cyprus, however, this stability may reflect a combination of domestic factors, such as relative price stability in energy and food, and external influences, including reduced import costs.
On more detail, annual inflation in the eurozone reached 2.2% in September 2025, according to Eurostat’s flash estimate, marking a slight increase from August’s 2%. However, behind this average figure lie significant disparities, both among member states and across different categories of goods and services, revealing a complex economic landscape.
As for the drivers of inflation, services remain the primary inflationary pressure, with an annual rate of 3.2% (up from 3.1% in August), followed by food, alcohol, and tobacco (3%). In contrast, energy continues to act as a drag, with prices falling by -0.4%, though the decline is less steep than in previous months (when it reached -2% in August). Non-energy industrial goods remain subdued, with just a 0.8% increase, highlighting weak demand in certain sectors of the economy.
The differences between countries remain, as Estonia records the highest inflation rate (5.2%), followed by Croatia (4.6%) and Slovakia (4.6%), while France (1.1%) and Italy (1.8%) sit at the opposite end of the spectrum. Greece shows a notable decline, from 3.1% in August to 1.8% in September, partly due to lower energy and food prices.
Meanwhile, countries like Ireland (2.7%) and Spain (3%) exhibit stabilization, while Cyprus (0%) stands out as the only country with zero inflation, underscoring the unique dynamics of its local economy.
(Source: CNA)
