Financial Analysis and Currency Deposits
Labour market conditions further improved while inflation has picked up
Unemployment rate at 6.6% in 1Q2022 (6.8% Euro area)
Quarterly Unemployment rate (%) (seasonally adjusted)
8.2
7.6
7.5
8.0
7.2
6.8
6.7
7.1
2Q2019
3Q2019
4Q2019
Cyprus
Euro area
1Q2021
2Q2021
3Q2021
6.6
4Q2021
6.2
1Q2022
Inflation remains elevated mainly due to surging energy prices
HICP Index (annual rate of change) (%)
2.2
1.9
Jun-21
Sep-21
Oct-21
Nov-21
10.6
9.0
8.9
7.4
8.6
5.0
6.2
4.8
Dec-21
Jan-22
Feb-22
Mar-22
Apr-22
May-22
Jun-22
Jul-22
Unemployment
Unemployment reduced to 6.2% in 1Q2022 from 6.6% in 4Q2021 and 8.2% in
2Q2021, attributed mainly to accommodation, trade and manufacturing sectors
Energy
•
No energy dependence on Russia
No gas dependence; Solely oil imports mainly from Greece, Italy and the
Netherlands
Indirectly affected by pricing pressures in the international energy markets
Steady increase in contribution from renewables (16% for 2021)
Significant gas discovery in Cyprus in August 2022; new opportunities for natural
gas exploitation
Milder winter compared to other European countries
Inflation
• Cyprus HICP +10.6% yoy in July 2022 (January-July 2022: average 7.7%), mainly
due to the impact of imported inflation in domestic economy (electricity and
petroleum products)
Pressure on household disposable income partly offset by:
Fiscal measures targeting mainly low-income households (€350 mn for
FY2022 announced up to July 2022)
High employment rate
Increase in wages (6.8% yoy increase in average gross monthly annual
earnings in 1Q2022)
Increase in household deposits by 1.1% in 1H2022 and by 7.8% since Jun
2020 to €26.0 bn
Limited Group's exposure to Russia, Belarus and Ukraine:
Cyprus
Euro area
Source: Eurostat, Central Bank of Cyprus
-
5% of deposits
- c.1% of net loans
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