Economic sentiment in Cyprus improves in October

The economic sentiment in Cyprus improved slightly in October 2022, with the Economic Sentiment Index (ESI) increasing by 0.4 points compared to September 2022.

According to a statement released this week by the University of Cyprus’ Centre for Economic Research, the marginal increase in the index came from a strengthening of the business climate in the services and retail trade sectors.

The improvement in sentiment in the services sector has been primarily attributed to the upward revision of turnover expectations for the fourth quarter of the year.

In the retail trade, sentiment rose due to more favourable assessments of the current situation and an upward revision of expectations for future sales.

The decline in the mood in the construction sector was the result of the more pessimistic evaluations regarding projects that are currently in progress.

In the manufacturing sector, sentiment worsened due to more pessimistic estimates for the output expected in the fourth quarter.

The decline in consumer sentiment in October was the result of more unfavourable assessments of the recent economic situation of households, as well the more pessimistic assessments of the future economic situation of the country.

Weakening consumer intentions in terms of making major purchases have also contributed to the decline in the broader consumer sentiment.

What is more, the Economic Uncertainty Index did not register a significant change in October when compared to the preceding month.

“From August onwards, the Economic Sentiment Index has been trending at lower levels than in the period between January and July 2022,” the report said.

“Uncertainty in the services sector hovered around the levels of the previous two months, while it experienced a rise in the remaining sectors,” it added, noting that consumer uncertainty eased slightly, although it still remains at a fairly high level.