Busi­ness and con­sumer con­fi­dence fall on out­put, pes­simism

Financial Mirror (Cyprus) - - FRONT PAGE -

The eco­nomic sen­ti­ment de­te­ri­o­rated in May as the Eco­nomic Sen­ti­ment In­di­ca­tor (ESICypERC) de­clined by 2.4 points from April to 109.5 (the same level as in March), as a re­sult of the wors­en­ing of busi­ness con­fi­dence in ser­vices and con­struc­tion, and the weak­en­ing of con­sumer con­fi­dence. How­ever, year-on-year, the ESI is still up 5.9 points.

Ac­cord­ing to the monthly sur­vey by the Uni­ver­sity of Cyprus Eco­nom­ics Re­search Cen­tre the Ser­vices Con­fi­dence In­di­ca­tor fell due to firms’ less pos­i­tive as­sess­ments of past busi­ness sit­u­a­tion and de­mand as well as to more pes­simistic views re­gard­ing firms’ turnover over the next three months. The Con­struc­tion Con­fi­dence In­di­ca­tor de­clined be­cause of more neg­a­tive as­sess­ments of or­der books and em­ploy­ment plans.

The ERC sur­vey added that the Con­sumer Con­fi­dence In­di­ca­tor de­te­ri­o­rated as a re­sult of (i) con­sumers’ more pes­simistic views re­gard­ing the fu­ture fi­nan­cial sit­u­a­tion of their house­hold and the gen­eral eco­nomic sit­u­a­tion in Cyprus, and (ii) a de­cline in the like­li­hood of sav­ing over the next 12 months. Fi­nally, the Re­tail Trade and In­dus­try Con­fi­dence In­di­ca­tors re­mained un­changed as the im­prove­ment in the as­sess­ments of re­cent trends was off­set by a de­te­ri­o­ra­tion of firms’ expectations.

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