Economic sentiment in Cyprus improved in August despite increased uncertainty among businesses and households, according to a survey released yesterday by the University of Cyprus’ Economic Research Centre.
The Economic Sentiment Indicator (ESI) rose by 1.5 units compared to July 2024, driven by improved business sentiment in the services, construction, and manufacturing sectors.
However, consumer sentiment declined further, with households reporting a deterioration in their recent and expected future economic situations, as well as reduced intentions for large purchases.
The services sector saw improved turnover expectations, while the construction sector strengthened for the second consecutive month due to more favourable responses about ongoing projects and employment estimates.
The manufacturing sector’s improvement was attributed to better production expectations for the next quarter.
Retail trade experienced a slight decline in sentiment, reflecting a worsening current situation and lower sales estimates for the coming quarter.
Consumer pessimism increased, with expectations for the country’s economic situation and household finances revised downwards. Perceptions of price movements over the past year reached a 10-month high, while expectations for future price trends were revised upwards.
The survey highlighted ongoing concerns about geopolitical tensions, particularly in the Middle East, volatile international markets, and setbacks in major Cypriot investment projects, especially in energy infrastructure.
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