Economic sentiment in Cyprus improves in November, UCy ERC says
08:50 - 29 November 2023
The Economic Sentiment Indicator (ESI-CypERC) in Cyprus improved in November 2023, compared to October 2023, mainly due to the strengthening of the business sentiment in the services and construction sectors, according to a survey conducted by the Economic Research Centre (ERC) of the University of Cyprus, in collaboration with RAI Consultants Ltd.
The Economic Sentiment Indicator (ESI-CypERC) increased by 2.6 points, compared to October, while the Economic Uncertainty declined further in November, owing to lower uncertainty among firms in services. However, uncertainty among businesses in other sectors, particularly in retail trade, increased. Uncertainty among consumers rose slightly.
In particular, according to the ERC, the increase in the Services Confidence Indicator primarily resulted from significant improvements in firms’ assessments of their recent performance (business situation and turnover), and, to a smaller extent, from upward revisions in demand expectations, rather than a strengthening of demand expectations, while the increase in the Construction Confidence Indicator resulted from improved assessments of the current levels of order books and upward revisions in employment expectations.
Furthermore, the Retail Trade Confidence Indicator remained unchanged at the level registered in October. In November, the improvement in firms’ views on recent sales and stock levels was offset by the deterioration in sales expectations.
It is also mentioned that the Industry Confidence Indicator decreased, as firms’ views on the current levels of order books and future production worsened. In manufacturing, sentiment eased on the back of more negative assessments of current orders and more pessimistic estimates of future production
In addition, according to the ERC, consumers in November appeared less pessimistic than in October about future labour market conditions, although a significant share still expects unemployment to rise.
Consumers' assessments of price developments over the past 12 months reflected some easing of upward pressures for the second consecutive month.