ERC Predicts 2015 & 2016 Cypriot Growth

The ERC stated in its August Economic Outlook, "Economic activity is forecast to pick up further in the following quarters of 2015 and in 2016. Real GDP growth for 2015 is projected at 1.1%. Real output is estimated to expand (y-o-y) by 0.5% in the second quarter of 2015 and by about 1.8% in the second half of the year. The projected growth rates for the second half of 2015 reflect the low levels of GDP reached during the corresponding period in 2014," as reported by Parikiaki.

ERC figures have determined that the Consumer Price Index inflation is forecasted for -1.7% in 2015 and 0.7% for 2016. In its report, the Center confirmed, "The negative inflation projection for 2015 is driven by the lower international oil prices combined with sluggish domestic demand. Low inflation is expected in 2016 as domestic demand and oil prices are anticipated to rise".

The ERC also discussed Greece's effect on Cyprus, "The recent economic developments in Greece which have worsened the outlook for the Greek economy could have a direct negative impact on the domestic economy, but could also cause adverse effects on Cyprus's sovereign bond yields through heightened market uncertainty...the recession in the Russian economy and rouble depreciation against the euro are likely to affect the outlook especially for 2015".