Cyprus economic sentiment declines to a year-low in June 2018

Cyprus’ Economic Sentiment Indicator declined to a year-low in June 2018 due to confidence deterioration in all sectors, surveyed, University of Cyprus Economic Research Centre (ERC) said.

According to the ERC, the ESI in June declined by seven units to 109.1 units.

“The decline resulted from confidence losses in all sectors surveyed, and among consumers,” the ERC added.

The Services Confidence Indicator declined sharply due to a deterioration in firms’ assessments of recent business conditions (i.e. business situation and demand over the last three months), and a large drop in demand expectations.

Less favourable assessments of past sales, and downward revisions in sales expectations, led to deterioration in the Retail Trade Confidence Indicator, the ERC added.

In Construction, the decline confidence indicator was driven by downward revisions in firms’ future employment plans.

According to the ERC, the decrease in the Industry Confidence Indicator resulted from a deterioration in firms’ assessments of overall order books, and an abrupt downward revision in production expectations.

The ERC noted that the Consumer Confidence Indicator decreased as a result of less optimistic views on the future economic conditions in Cyprus and the decline in unemployment, while the indicator was also, adversely affected by consumers’ savings expectations.

“The reduction in the June 2018 ESI compared with May is due to the deterioration of the climate in all fields and in consumers,” the ERC said, adding that from the total 15 components used in the ESI, 11 showed deterioration.