Causes and Implications of Elevated Inflation in Cyprus

Inflation has risen sharply in Cyprus, initially driven by imported prices, but increasingly broadening to domestic prices. A Phillips Curve estimate attributes the high inflation largely to energy prices, external price pressures, and inflation expectations at the end of 2022. Historically high pas...

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Bibliographic Details
Main Author: Beyer, Robert
Format: eBook
Language:English
Published: Washington, D.C. International Monetary Fund 2023
Series:Selected Issues Papers
Subjects:
Online Access:
Collection: International Monetary Fund - Collection details see MPG.ReNa
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653 |a Energy pricing 
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653 |a Income 
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653 |a International Organizations 
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653 |a Deflation 
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653 |a Price Level 
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653 |a International Economics 
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520 |a Inflation has risen sharply in Cyprus, initially driven by imported prices, but increasingly broadening to domestic prices. A Phillips Curve estimate attributes the high inflation largely to energy prices, external price pressures, and inflation expectations at the end of 2022. Historically high pass-through of inflation shocks to wages—amplified by a tight labor market—may make inflation persistent. This calls for policies to stem inflationary pressures while protecting vulnerable households