The economic sentiment indicator fell in February by 1.9 points to 114.2 mainly on deteriorating business confidence in services and retail trade and on reduced consumer confidence, the University of Cyprus said.
The drop in business confidence in the service sector was mainly on more pessimistic expectations about turnover over the next three months, the Economic Research Centre (ERC) of the university said in an emailed statement on Thursday. The decrease in confidence in retail trade was on more unfavourable evaluation of inventory levels and more pessimistic expectations about sales in the coming three months.
In construction and industry, business confidence improved, this month, the ERC said. The improved business confidence in construction was on better expectations about employment levels in the next three months, while in industry interviewed companies said that their evaluation of current orders was less negative. They also revised their production expectations in the next three months upwards.
The drop in consumer confidence was on more pessimistic assessments of the labour market conditions and the financial situation of households over the next 12 months, the ERC added.