The Cyprus Composite Leading Economic Inde (CCLEI) recorded a year-over-year increase of 14.8% in Januar 2022, reaching a level of 109.4, after year-over-year increases of 14.4% in December 2021 and 13.8% in November (based on recent and revised data).
Most of the CCLEI’s domestic and international components contributed to its upward trend in January 2022. More specifically, the strengthening of confidence in all business sectors, and especially in the services sector in January 2022 compared to January 2021, strengthened the Economic Sentiment Indicators (ESI) in Cyprus and the euro area, that compose the CCLEI. Moreover, the total number of property sales contracts and the temperature-adjusted volume of electricity production continue to have a positive effect on the CCLEI, increasing in January 2022 compared to a year ago. The value of credit card transactions also shows a significant year-over-year increase. The tourists’ arrivals and the retail sales volume continue to exert a positive effect on the CCLEI and domestic economic activity, according to preliminary data in January. In contrast, the Brent Crude oil price contributes to the restraint of the CCLEI’s growth in January, since it marked a significant increase in January 2022 compared to January 2021.
In conclusion, the Cypriot economy will remain on a recovery pace according to the positive year-over-year growth rate of the CCLEI recorded in January 2022, although the rising price of the Brent Crude oil and the continuing challenges of the pandemic continue to be aggravating factors in its short-term development prospects. Further information regarding the methodology of constructing the CCLEI can be found at: Cyprus Composite Leading Economic Index (CCLEI)
Notes:
- The CCLEI Index is estimated based on the econometric model of Aruoba, Diebold and Scotti (ADS) (2009).
- The CCLEI for January 2022 is constructed based on the availability of the Brent Crude oil price, the ESI in the euro area and in Cyprus, the total number of property sales contracts, the value of credit card transactions, as well as the high frequency data of the passengers’ arrivals and the temperature-adjusted volume of electricity production in January, while the retail sales volume is estimated based on the latest available information in a series of various economic indicators.
