Consumer confidence deteriorates

In April, economic sentiment deteriorated, weighed by a three-year low in consumer confidence battered by a cost-of-living crisis and weaker business activity, according to a University of Cyprus index.

The university’s Economic Sentiment Indicator (ESI-CypERC) decreased by 2.8 points compared with March.

The decrease in the index resulted from weaker business confidence in services and industry and significant confidence losses among consumers, the Economics Research Centre of the University of Cyprus said.

Moreover, the Services Confidence Indicator declined as firms revised their demand expectations downwards, despite slightly improving views on the past business situation.

The small increase in the Retail Trade Confidence Indicator resulted from more favourable assessments of past sales and improved views on the current stock levels.

Better outcomes drove an improvement in the Construction Confidence Indicator.

In April, firms assessed their current levels of order books more favourably and revised their employment expectations upwards.

The slight decrease in the Industry Confidence Indicator was mainly due to the deterioration of firms’ assessments of the stocks of finished products.

Consumers revised their expectations about their future financial conditions and the economy downwards.

Furthermore, consumer intentions to make major purchases in the near future weakened in April.

Economists argue that economic instability in Cyprus rose due to higher uncertainty levels experienced by services.

Uncertainty in the retail trade and construction declined while manufacturing firms stayed at the level registered in March.

Unease among consumers declined further in April, registering its lowest value in three years.