Cyprus’ economic climate continues to improve for the second month in a row

Cyprus’ economic situation is showing signs of recovery: in May 2026, the economic sentiment index rose by 4.2 points compared with April. This was reported by the Economics Research Centre of the University of Cyprus.

According to the published data, the increase in the indicator is mainly linked to an improved business climate in the services and construction sectors, as well as greater consumer confidence.

In the services sector, companies became more optimistic about turnover prospects in the coming months. In addition, businesses have a more positive view of the current state of the economy. In construction, the improvement is associated with a more favorable assessment of ongoing projects and market activity.

In industry, the overall climate also showed a slight increase. Despite cautious forecasts for production volumes in the next quarter, businesses gave a positive assessment of current order levels and finished goods inventories.

In retail trade, the situation was less stable. Although retailers improved their expectations for future sales, weaker assessments of recent results led to a slight decline in sector indicators.

Consumer sentiment strengthened notably in May. Residents of the island became more positive about both their own financial situation and the country’s economic prospects. Caution regarding major purchases in the coming months also decreased.