Nicosia:The economic climate in Cyprus deteriorated in October 2026, with a notable decline in consumer confidence affecting the overall sentiment, as reported by the Economics Research Centre (ERC) of the University of Cyprus. The Economic Sentiment Indicator (ESI) experienced a decrease of 1.0 point compared to September.

According to Cyprus News Agency, the ERC attributed the fall in the ESI primarily to a further weakening of consumer confidence and, to a lesser extent, a decline in business sentiment within the manufacturing sector. Consumers have expressed a more negative view of their recent household financial situations compared to previous months.

The ERC also highlighted that in October, consumers adjusted their expectations downward regarding the future economic conditions of both their households and the nation. The sentiment in manufacturing worsened due to more negative evaluations of current order books and reduced production expectations.

In contrast, business sentiment in the services sector remained stable at the positive levels seen in September, while the construction sector saw slight improvements, driven by more favorable assessments of ongoing projects. Retail trade sentiment improved as well, reflecting better evaluations of both the current situation and sales expectations.

Furthermore, the ERC noted an increase in the Economic Uncertainty Index in October, fueled by rising uncertainty among consumers and businesses across all sectors except construction. The heightened uncertainty among businesses in the services sector and households from all income groups significantly contributed to the index's rise during the month.