Economic confidence in Cyprus registered its sixth straight month of gains in September 2026, driven primarily by broad-based optimism across key business sectors. According to the Economic Research Centre of the University of Cyprus (CypERC), the Economic Sentiment Indicator (ESI-CypERC) rose by 0.6 points month-on-month, continuing an upward trend that began in early spring.
September 2026 Sectoral Sentiment Summary
While business sentiment generally improved, consumer confidence and retail trade pulled in the opposite direction:
| Sector / Component | Indicator Movement | Primary Drivers |
| Services | Gained ground (3rd consecutive rise) | Upwardly revised turnover expectations. |
| Construction | Slight increase | Higher current order book assessments and stronger hiring outlooks. |
| Industry | Edged up | Improved views on existing orders and finished goods inventory, despite weaker production forecasts. |
| Retail Trade | Declined | Weaker sales assessments and downgraded short-term revenue expectations. |
| Consumer Sentiment | Declined | Concerns over personal financial outlooks and decreased willingness to make large purchases. |
Core Business Trends vs. Consumer Behavior
1. Broad Service and Industry Expansion
Optimism within the services sector—a crucial driver of the Cypriot economy—continued to build for a third consecutive month as firms anticipated stronger revenue streams. Industrial and construction firms also posted modest gains, buoyed by solid current order books and positive employment expectations. However, industrial managers expressed caution regarding future production volumes.
2. Retail Softening and Rising Consumer Caution
In contrast to the broader business trend, the retail sector contracted due to lower recent sales volumes and pessimistic sales forecasts. At the same time, Cypriot consumers pulled back on major spending:
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Future Financials: Expectations regarding household financial health worsened.
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Major Purchases: Intentions to buy high-value items weakened during the month.
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Savings Orientation: Consumers showed an increased intent to build up cash reserves rather than spend.
Economic Uncertainty Division
The overall Economic Uncertainty Indicator for Cyprus climbed significantly in September, displaying a clear split between commercial enterprises and households:
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Business Uncertainty: Surged markedly, driven predominantly by heightened unpredictability within the services industry.
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Consumer Uncertainty: Continued its downward trend, falling to exceptionally low levels across all income brackets.
Source: Stockwatch.com.cy