Cyprus' economic climate improved for a fifth consecutive month in August 2026, with the Economic Sentiment Indicator (ESI) rising by 1.4 points compared with July.
According to data released by the Economics Research Centre of the University of Cyprus, the latest increase was driven by stronger business sentiment across all sectors except construction, alongside improved consumer confidence.
The improvement in the services sector reflected more positive assessments of businesses' current financial situation and turnover over the past quarter. The stronger climate in retail trade and manufacturing was attributed to upward revisions in business expectations for sales and production, respectively. The slight dip in construction sentiment was attributed to less favourable assessments of ongoing projects.
Consumer sentiment also improved in August. Households gave more favourable responses regarding both their current and expected future financial situation, while intentions to make major purchases in the coming months strengthened significantly.
The Economic Uncertainty Index declined further in August, reflecting lower consumer uncertainty across all income groups, as well as reduced business uncertainty in the services and manufacturing sectors.
