Economic sentiment deteriorates in March reflecting COVID-19 pandemic initial impact

Economic sentiment in Cyprus deteriorated markedly in March 2020, as the Economic Sentiment Indicator (ESI-CypERC) decreased by 12.1 points compared with February 2020, reflecting the initial impact of the coronavirus pandemic on the Cypriot economy.
 
According to a press release from the Economic Research Centre of the University of Cyprus, the decrease in ESI-CypERC resulted from a deterioration in business confidence in all sectors, particularly in services, as well as from a sharp weakening of consumer confidence.
 
The decrease in the Services Confidence Indicator was driven by firms’ less favourable views on their past business situation and large downward revisions in demand expectations.
 
The decrease in the Retail Trade Confidence Indicator resulted from downward revisions in sales expectations.
 
The Construction Confidence Indicator dropped due to firms’ less favourable assessments of the current levels of their order books and downward revisions in employment expectations.
 
 The Industry Confidence Indicator declined as a result of a deterioration in firms’ assessments of the current levels of their order books and stocks of finished products, as well as downward revisions in production expectations.
 
The Consumer Confidence Indicator declined as consumers’ expectations about their financial condition and the economic conditions in Cyprus deteriorated sharply, and consumers’ intentions to make major purchases weakened considerably.