Economic sentiment in Cyprus experienced a slight downturn in January 2025, with the Economic Sentiment Indicator (ESI-CypERC) decreasing by 0.6 points compared to December 2024.

According to the Economics Research Centre of the University of Cyprus (CypERC), this decline was primarily driven by weaker business confidence in the construction and industrial sectors, along with lower consumer confidence.

Delving into the latest report, the Services Confidence Indicator saw a small increase, as businesses were more optimistic about their expected turnover, although assessments of recent performance were less favourable.

The Retail Trade Confidence Indicator also increased slightly, as firms revised their sales expectations upwards.

In contrast, the Construction Confidence Indicator dropped sharply, with firms expressing more negative views on current order books and revising their employment expectations downwards.

Similarly, the Industry Confidence Indicator decreased due to worsening assessments of finished goods stocks.

The Consumer Confidence Indicator also registered a small decline in January.

Consumers’ views on their recent financial situation worsened, and their intentions to make major purchases weakened.

However, consumers’ expectations regarding their financial situation and the general economic conditions in Cyprus remained relatively high compared to previous months.

Furthermore, the Economic Uncertainty Indicator for Cyprus decreased slightly, reflecting a reduction in firms’ uncertainty about their future business prospects across most sectors, except for industry.

On the other hand, consumers’ uncertainty about their future financial situation rose in January, although it remained below its historical average.