Economic sentiment declines to a year-low in June

Cyprus’ Economic Sentiment Indicator declined to a year-low in June due to confidence deterioration in all sectors, the University of Cyprus Economic Research Centre (ERC) said.

According to the ERC, the ESI in June declined by seven units to 109.1 points compared to May.

“The decline resulted from confidence losses in all sectors surveyed, and among consumers,” the ERC said.

The Services Confidence Indicator declined sharply due to a deterioration in firms’ assessments of recent business conditions (i.e. business situation and demand over the last three months), and a large drop in demand expectations.

Less favourable assessments of past sales, and downward revisions in sales expectations, led to deterioration in the Retail Trade Confidence Indicator, the ERC said.

In Construction, the decline in confidence was driven by downward revisions in firms’ future employment plans.

A decrease in the Industry Confidence Indicator resulted from a deterioration in firms’ assessments of overall order books, and an abrupt downward revision in production expectations.

The ERC noted that the Consumer Confidence Indicator decreased because of less optimistic views on the future economic conditions in Cyprus and the decline in unemployment, while the indicator was also, adversely affected by consumers’ savings expectations.

From a total 15 components used in the index, 11 showed deterioration.