CBC Governor Warns of Inflation Risks as Middle East Conflict Persists

The Central Bank of Cyprus (CBC) governor Christodoulos Patsalides has warned that inflation risks are still tilted upwards due to the ongoing conflict in the Middle East, despite the European Central Bank's (ECB) decision to keep interest rates unchanged.

Patsalides said that while the broader effects of the energy shock remain contained for now, elevated energy prices are increasing production costs and putting upward pressure on inflation.

The ECB left its key interest rates unchanged earlier this week, citing continued uncertainty surrounding the economic outlook and potential consequences of higher energy prices.