Cyprus – Ratings Affirmed and Outlook Revised to Positive

18 September 2026

Rating Action

Capital Intelligence Ratings (CI Ratings or CI) today announced that it has revised the Outlook on the Republic of Cyprus’s Long-Term Foreign Currency Rating (LT FCR) to Positive from Stable and affirmed the LT FCR at ‘BBB+’. The sovereign’s Short-Term FCR (ST FCR) remains at ‘A2’.

Rating Rationale

The Positive Outlook reflects the further improvement in the public finances alongside CI Ratings’ expectation that budget performance will remain relatively strong in the short to medium term, despite domestic spending pressures and a more challenging external and geopolitical environment.  This is evidenced by the persistent general government budget surpluses, a decline in general government debt faster than we had projected in our last review, and low short- to medium-term fiscal risks. Active public debt management has also helped reduce refinancing pressures, while significant government cash buffers provide a strong…