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S&P Reaffirms Cyprus's A- Rating with Positive Outlook

Published March 21, 2026, 08:13
S&P Reaffirms Cyprus's A- Rating with Positive Outlook

S&P Global Ratings has reaffirmed Cyprus's long-term rating at 'A-' and its short-term rating at 'A-2', while maintaining a 'positive outlook' for the Cypriot economy. The positive outlook reflects the expectation that Cyprus's external performance could exceed its forecast for the Cypriot economy over the next two years, despite uncertainties created by the ongoing conflict in the Middle East. S&P anticipates strong growth in the Cypriot economy in the coming years, with an average GDP growth of 2.8% between 2026 and 2029, supported by domestic demand, private and public investments (including New Generation - EU funds). Furthermore, it predicts a fiscal surplus of over 3% of GDP by 2029, which will lead to a reduction in the general government debt. Despite the initially low inflation rate (0.9% in February), an increase above 2% is expected due to potential energy price increases. The Cypriot Presidency described the rating confirmation as a vote of confidence in the country's economy.