Cyprus shoppers turn selective as summer retail sales hold strong

Foreign residents boost Cyprus retail market Cyprus consumers are visiting supermarkets more often, comparing prices across several stores and avoiding unnecessary purchases. However, the shift towards smaller baskets has not prevented the retail market from delivering a solid summer performance. The positive picture has emerged despite continued inflationary pressure. The Harmonised Index of Consumer Prices rose 4.4 per cent year-on-year in July and 0.7 per cent from June, according to the statistical service (Cystat). Food and non-alcoholic beverages were 4.54 per cent more expensive than a year earlier, while housing and electricity costs increased 6.98 per cent. The sharpest rise, at 11.95 per cent, was recorded in restaurants and accommodation services. By contrast, clothing and footwear prices fell 5.24 per cent. Within this environment, Pasyle secretary-general Marios Antoniou and supermarkets association executive secretary Andreas Hadjiadamou both told the Cyprus News Agency (CNA) that consumers had become more selective, searching for offers and avoiding unnecessary purchases. Antoniou said retail activity remained healthy despite inflation and the resulting pressure on household purchasing power, with footfall and turnover at “very strong levels”. Figures covering the first eight months, he explained, now provided a representative picture of how retail trade was likely to perform across 2026. Both July and August had performed particularly well across the sector, he added, not only in terms of customer traffic but also turnover. Behind those strong figures, however, shopping habits are changing. Antoniou described consumers as better informed than in previous years, saying they had “made great strides as consumers” and were now making smarter choices about what they bought. Demand has also been strengthened by the growing number of foreign nationals living permanently in Cyprus. Antoniou referred specifically to Israeli, Russian and Ukrainian residents who live and work on the island, saying their spending was having a positive impact on the market. The broader consumer base, he added, was helping the market grow, attracting retail chains interested in establishing a presence in Cyprus and supporting interest in the creation of new shopping centres. The shift towards more cautious spending is particularly visible in supermarkets. Hadjiadamou said most consumers now concentrate on products they genuinely need, rather than adding unnecessary items to their baskets, attributing the change to the geopolitical developments of recent years and their impact on prices and purchasing power. Hadjiadamou said “consumers are visiting supermarkets more often, but they are not stocking up as much as they used to”. At the same time, they are no longer loyal to one retailer, he explained. He added that “consumers no longer limit themselves to one supermarket, or one or two as they did in the past”, but may move between several stores, beginning with a large chain and ending at neighbourhood supermarkets to take full advantage of the offers available. Their caution has been reinforced by inflation and developments in the region, including their impact on fuel prices. In response, Hadjiadamou said supermarkets were “trying to contain prices by working with suppliers and partners and seeking agreements that will allow for greater price stability”. This search for value is also leading more consumers towards private-label products. Antoniou said supermarket own brands were increasingly seen as good-quality, affordable alternatives, while the ranges available had expanded well beyond a limited number of basic goods. Although no comparable data are available for Cyprus, private-label products have reached 26 per cent of food turnover in Greece. Meanwhile, smaller baskets do not appear to have reduced the overall volume of purchases, as consumers are compensating by returning to stores more frequently. Antoniou pointed to the latest Cystat figures for June, which showed turnover volume among predominantly food, beverage and tobacco retailers increasing 4.9 per cent during the first half of 2026. Retail activity is also receiving a late-summer lift from school supplies. Antoniou said seasonal sales and tourism had supported the market during the summer, while demand for school items was now becoming its third main driver. School supplies are among the strongest non-food retail categories after Christmas, with demand beginning to rise in August before peaking during the first week of September, as families return from holiday and prepare for the new school year. Antoniou added that the broad range of products and prices gave consumers plenty of choice to match their budgets.