The Cyprus Composite Leading Economic Index (CCLEI) continued its annual gains in September indicating a recovery of the economy, which depends however on the development associated with the Covid-19 pandemic, University of Cyprus’ Economic Research Centre has said.
The CCLEI, compiled by the ERC with the support of Hellenic Bank, in September 2021 recorded a year on year increase of 11.3%, reaching a level of 114.5 units. The new growth came after annual increases of 10.8% in August and 11.0% in July (based on the latest and revised data), the ERC said.
According to preliminary data in September, a positive effect on the CCLEI and domestic economic activity is exerted by tourist arrivals and the volume of retail sales during the third quarter of 2021, while the total number of property sales contracts continues to contribute to the positive year-over-year performance of the CCLEI in September.
Credit card transactions mark a positive rate reversing the previous two months' negative course, although the reversal of the growth rate of credit card transactions may be associated, in part, to the new decree of mandatory use of credit cards in the retail sector.
Furthermore, the September CCLEI was pushed upwards by the Economic Sentiment Indicators (ESI) in Cyprus and the euro area, which strengthened in September 2021 compared to September 2020 due to the strengthening of confidence in all business sectors except the construction sector in Cyprus.
According to the ERC, the negative year-over-year growth rate of the volume of electricity production, as well as the significant year-over-year increase in the Brent crude oil price, contribute to the restraint of the year-over-year growth of the Index in September.
“In conclusion, the recording of positive year-over-year growth rates of the CCLEI during the last two quarters of 2021 indicates a path towards the recovery of the Cypriot economy, which, however, continues to depend on the future development of the COVID-19 pandemic,” the ERC added.