Cyprus’s economic sentiment index increased by 5.1 points to 115 points in August, after increasing by 1.6 points the month after a referendum decided the end of the European Union membership of the UK, Cyprus’s largest source of incoming tourism, the University of Cyprus said.
The improved economic sentiment, which reached a nine-year peak this month, was mainly on increased business confidence in services, followed by an improvement in retail trade and industry, the Economic Research Centre of the university said in a statement on its website on Monday.
Interviewed service companies said that they were more upbeat with respect to their expectations for demand in the three months to come and cited their improved financial situation and demand over the past three months, the ERC said.
Retail trade companies said that their evaluation of sales over the past three months were less negative than expected, while their expectations for sales in the next three months improved, the ERC added. In industry, interviewed companies said that they were less pessimistic about the current order book and their production expectations over the next three months.
On the other hand, construction companies said that their evaluation of projects currently in progress was more negative and they expected to reduce employment levels over the next three months.
The climate among consumer improved marginally as better evaluations of households’ financial situation and the labour market was largely offset by a more negative stance towards saving.