Economic sentiment in Cyprus improved marginally in April, with the Economic Sentiment Indicator (ESI) increasing by 0.8 points compared to March 2024, according to a report by the University of Cyprus’ Economic Research Centre (CypERC).

Specifically, the CypERC noted that the rise in the ESI was driven by strengthening business sentiment across all sectors, with the largest increases occurring in the manufacturing and construction sectors.

Furthermore, the improvement in services sentiment was marginal in April and was driven solely by more optimistic estimates of turnover in the next quarter. In the retail trade sector, sentiment rose slightly, supported by more favourable assessments of current inventory levels and improved expectations for the next quarter’s sales.

In the construction sector, businesses gave more favourable assessments of their ongoing projects and more optimistic estimates of their number of employees, resulting in stronger sentiment in the sector.

The CypERC added that the strengthening in manufacturing sentiment was due to an improvement in all aspects that make up the sector’s sentiment, namely assessments of current order levels and finished goods inventories, as well as expectations for production in the next quarter.

In contrast, it is reported that consumer sentiment declined in April as consumers appeared more pessimistic about the future economic situation of their households and the country in general, compared to March.

Simultaneously, the Economic Policy Uncertainty (EPU) index increased marginally in April, due to greater uncertainty among businesses in the services and retail sectors. Uncertainty in the construction sector and

among consumers declined, while in the manufacturing sector, it remained close to the relatively elevated levels of the previous two months.

Lastly, the CypERC reports that sales price expectations continued to move upward in retail trade and at the same time consumer price expectations were revised upward, reaching their highest point in six months.