CBC Governor Warns Energy Prices Fuel Inflation Risks

Cyprus's Central Bank governor Christodoulos Patsalides warned that energy prices are increasing inflation risks, although there is no evidence supporting an immediate increase in interest rates.

In a recent interview with Econostream, Patsalides stated that the European Central Bank's decision to keep interest rates unchanged was appropriate. He noted that inflation remains broadly in line with expectations and second-round effects have not emerged.

The governor emphasized that policymakers must balance incoming evidence with the need to act before inflation becomes entrenched, particularly due to prolonged geopolitical tensions and elevated oil prices.