CYPRUS: Economic sentiment slipped in June on weaker business confidence

In June, economic sentiment deteriorated on weaker business confidence as the Economic Sentiment Indicator decreased by 1.9 points compared with May, the University of Cyprus research centre said.

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The index dropped from 111.4 points in May to 109.5 in June but on an annual base, sentiment was slightly up 2.2% from 107.1 in June 2018.

According to the ESI‐ CypERC, the June 2019 decrease resulted from weaker business confidence in the services and construction sectors.

A decline in the Services Confidence Indicator was driven by companies having less favourable views on their past performance (business situation and demand), and downward revisions in demand expectations.

The small increase in the Retail Trade Confidence Indicator was due to firms’ improved assessments of past sales and current stock volumes.

The Construction Confidence Indicator declined due to businesses having a more negative assessment of their current level of order books, and downward revisions in employment expectations.

The increase in the Industry Confidence Indicator resulted from firms’ improved views on the current level of their order books and their stocks of finished products. Upward revisions in production expectations also contributed to the increase in the Confidence Indicator.

The Consumer Confidence Indicator also increased marginally mainly due to consumers being less pessimistic regarding their intentions to make major purchases over the next 12 months.