Economic Sentiment in April improved significantly

The economic sentiment in Cyprus improved In April 2021 significantly as the Economic Sentiment Indicator (ESI-CypERC) increased by 9.2 points compared with March 2021.

However, according to a report by the Economics Research Center of the University of Cyprus, April Surveys had been completed before the announcement of tighter pandemic containment measures in Cyprus on 23 April.

The increase in the ESI-CypERC was driven primarily by large confidence gains in services, and, to a lesser extent, by confidence improvements in retail trade, industry and among consumers.

The sizable increase in the Services Confidence Indicator resulted from improved assessments of past performance (business situation, demand) and significant upward revisions in demand expectations.

Nevertheless, in April uncertainty rose substantially, suggesting that the recovery of business confidence in the services sector remains fragile.

The increase in the Retail Trade Confidence Indicator was due to improved assessments of past sales and upward revisions in sales expectations, despite less favourable views on the current stock levels.

The Construction Confidence Indicator declined marginally because of downward revisions in employment expectations, despite more favourable assessments of the levels of order books.

The Industry Confidence Indicator increased as a result of improved assessments of the current levels of order books and upward revisions in production expectations.

The Consumer Confidence Indicator rose in April, registering improvements for the third month in a row. Consumers assessed their recent financial conditions more favourably and revised their expectations about the future economic conditions in Cyprus upwards; also, they expressed stronger intentions to make major purchases over the next months.