Cyprus: Economy loses notable steam in the first quarter
May 29, 2020
GDP growth eased to 0.9% year-on-year in the first quarter from 3.4% in the fourth quarter on partial Covid-19 effects. Q1’s print marked the worst reading since Q1 2015.
Household spending growth eased to 1.8% in Q1, marking the weakest expansion since Q2 2015 (Q4 2019: +2.2% yoy). Public spending accelerated, increasing 16.8% in Q1 (Q4 2019: +3.4% yoy). Meanwhile, fixed investment soared 31.4% in Q1, rebounding strongly from the 33.0% contraction logged in the previous quarter.
Exports of goods and services contracted 9.5% in Q1, marking the worst result in three years (Q4 2019: +4.8% yoy). On the other hand, imports of goods and services climbed 0.3% in Q1 (Q4 2019: -7.8% yoy).
On a seasonally- and working-day-adjusted quarter-on-quarter basis, the economy contracted 1.3% in Q1, contrasting Q4 2019's 1.0% expansion. Q1's downturn marked the worst reading since Q2 2013.
Author: Javier Colato, Economist