In September 2024, the Economic Sentiment Indicator deteriorated, falling by 1.4 points compared to August 2024.

According to the University of Cyprus’ Economics Research Centre, this decline was driven by a drop in business confidence in the services and construction sectors, reversing the gains in economic trust seen in August.

The decrease in sentiment in the services sector was mainly due to less favorable assessments of the current business situation and, to a lesser extent, lower expectations for turnover.

In the construction sector, the weakening sentiment resulted from more negative responses regarding ongoing projects and less optimistic expectations for employment levels.

Conversely, the report noted that retail trade saw an improvement in sentiment, primarily due to better evaluations of sales over the last and next quarter.

Additionally, the manufacturing sector showed growth for the second consecutive month, thanks to more favorable assessments of current orders and positive expectations for production in the next quarter.

Consumer sentiment also improved slightly in September, mainly due to more optimistic responses regarding both their current and future financial situation.

"The Economic Uncertainty Index for Cyprus decreased in September. Factors that contributed to increased uncertainty in August, such as volatility in international markets and limited progress on the Cyprus-Greece electricity interconnection, subsided. Furthermore, the slowdown in inflation and declining interest rates appear to ease businesses' and households' ability to assess their future economic situation," the report concluded.