Clouds are produced during the condensation step of the water period. At the condensation step, water that is in the formation of water vapour turns from a vapour into liquid water. This step is important to the water cycle because the production of clouds is important so that presumption can later fall, reversing the water back to the surface.
Condensation is the process by which water vapor in the air is changed into liquid water. Condensation is crucial to the water cycle because it is responsible for the formation of clouds.