ECONOMY

Cyprus economic sentiment rises but uncertainty remains

cyprus-economic-sentiment-rises-but-uncertainty-remains

Cyprus’ economic sentiment improved in August from July, reflecting stronger activity in services but uncertainty remains, fueled by the Covid pandemic.

]The Economic Sentiment Indicator (ESI), compiled by the University of Cyprus’ Economic Research Center (ERC), rose by three units in August from the previous month to 108.6 units.

“The increase in the ESI resulted from stronger business confidence in services and, to a smaller degree, from gains in retail trade and among consumers,” ERC said.

A year ago, the ESI registered only 8.38 points following a harsh national lockdown. In August, the ESI was still above the long-term average of 100 units that it regained in April after falling into double digits at the start of the Covid-19 pandemic in March 2020. Despite a dip in July, indicators have been moving upward, but insecurity remains during the fourth wave of the coronavirus.

According to University of Cyprus economists, the Services Confidence Indicator increased due to favorable past performance assessments (business situation and demand) and upward revisions of sales expectations. A marginal rise in the Retail Trade Confidence Indicator was also due to improved past sales assessment despite downward expectations revision. Downward revisions in employment expectations were offset by improved assessments of order book levels, leaving the Construction Confidence Indicator unchanged from July. Furthermore, the Industry Confidence Indicator remained unchanged, as the downward revisions in production expectations were offset by improvements in recent performance. (Financial Mirror)