Cyprus – Sovereign Ratings Upgraded; Outlook Revised to Stable

Cyprus – Sovereign Ratings Upgraded; Outlook Revised to Stable

Rating Action

Capital Intelligence Ratings (CI Ratings or CI) today announced that it has upgraded the Republic of Cyprus’ Long-Term Foreign Currency Rating (LT FCR) to ‘BBB + ’ , from ‘BBB’ . At the same time , CI Ratings has affirmed the sovereign’s Short-Term FCR (ST FCR) at ‘A 2 ’ . The Outlook for the rating s has been revised to Stable from Positive following the upgrade .

Rating Rationale

The upgrade reflects the marked improvement in fiscal strength, including a sustained decrease in short- to medium-term fiscal risks. This is driven by higher-than-expected general government budget surpluses, low gross financing needs , and a faster than projected decline in government debt , with the debt -to- GDP ratio now projected to fall to around 56 % by 2026. P roactive management of the debt maturity profile has helped reduce …