DoorDash has agreed to acquire Instacart in a $17 billion deal that would bring two of the largest players in on-demand delivery under one corporate roof. The proposed combination pairs DoorDash’s strength in restaurant delivery with Instacart’s grocery expertise and retailer relationships.

Under the agreement, DoorDash will pay $65 for each Instacart share. The boards of both companies have approved the transaction, which is expected to close toward the end of 2027 or during the first half of 2028.

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A Broader Platform For Local Commerce

The companies say the acquisition could give grocers more tools to grow their digital businesses. Instacart’s technology helps retailers run online ordering and advertising operations, while DoorDash’s logistics network could help stores fulfill more digital orders and offer lower-cost delivery options.

DoorDash plans to retain Instacart’s brand, app and enterprise technology products. The companies will continue operating independently until the transaction closes.

“Over the last 14 years, Instacart has transformed online grocery by helping retailers of all sizes compete and grow, and joining forces with DoorDash allows us to do even more,” Instacart CEO Chris Rogers said in the companies’ announcement.

Rogers said the combination could unite Instacart’s grocery technology and retailer relationships with DoorDash’s consumer reach and delivery capabilities, creating new opportunities for retail and brand partners while improving the experience for customers and shoppers.

Why Grocery Is A Strategic Test

Grocery delivery presents a more complex operating challenge than restaurant takeout. Orders require shoppers to select fresh products, manage substitutions and deliver temperature-sensitive items on time. That complexity makes Instacart’s category-specific capabilities a strategic asset for DoorDash as it expands beyond restaurant delivery.

“Grocery is one of the hardest things to get right online,” DoorDash CEO Tony Xu said in the announcement. He pointed to the need to select ripe produce, choose suitable replacements and deliver frozen items before they melt.

Xu said Instacart has developed grocery expertise for retailers, while DoorDash has built delivery infrastructure used by local businesses. Together, the companies aim to give stores of different sizes access to more digital-commerce and fulfillment tools.

A Timely Exit In A Competitive Market

Instacart had a market capitalization of more than $13 billion, and its shares were up 25% year to date, according to the source report. The proposed $65-per-share offer gives shareholders a defined transaction value at a time when competition in grocery delivery is intensifying.

Bloomberg previously reported that Instacart had held acquisition discussions with Uber before walking away from those talks. The reported DoorDash agreement now sets the stage for a significant consolidation in a market where scale, delivery economics and retailer relationships are increasingly important.

More information is available from DoorDash and Instacart.

French AI company Mistral has released the model weights for its latest flagship system, Mistral Large 4 (ML4), internally known as “Le Chonk”. The company says the model delivers significant coding improvements and could strengthen cyber defences as Europe seeks greater control over its technology infrastructure.

Mistral describes ML4 as “the best open agentic coding model in the world”, giving businesses and governments greater control over AI tools for detecting, analysing and responding to threats across software and IT infrastructure.

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The release follows a preview announced on 6 October. Since then, Mistral has continued reinforcement learning and tested the model with customers and partners in real-world environments.

“ML4 OSS showcases our science team’s ability to innovate at speed,” said Pierre Stock, Mistral’s vice president of science. The open-weight version builds on the preview with further training and performance gains, he added. Customer feedback was incorporated in less than three weeks, bringing two reasoning modes and improvements to efficiency and customisation.

Coding Performance And Cybersecurity Risks

Mistral says ML4 is competitive with leading open coding models and uses an average of 47% fewer tokens per task than China’s GLM-5.3. On Terminal-Bench 4.0, a benchmark for terminal-based coding tasks, its score rose from 28% to 41% after additional training.

The launch comes amid growing cyber risks in Europe, including a major PHP vulnerability reportedly identified with AI assistance and cyberattacks affecting Belgium’s finance and tax agency and Norway’s public sector.

AI can help security teams analyse code and infrastructure at scale, but it can also introduce new risks. Secure deployment, access controls and human oversight remain essential.

Why Open Weights Matter

Making model weights available allows organisations to run AI on their own infrastructure rather than rely solely on a provider’s hosted service. This can give businesses handling proprietary code or sensitive data greater control over information processing and system integration.

However, self-hosting requires sufficient computing capacity and technical expertise. Mistral also argues that on-premises deployment reduces the risk of third-party providers restricting or withdrawing access.

The issue has gained prominence as Europe seeks to reduce its dependence on US AI providers. In June, the Trump administration ordered Anthropic to suspend access to its Fable 5 and Mythos 5 models for foreign nationals. Restrictions were later lifted for Fable 5, while access to Mythos 5 remained limited to selected organisations. The episode highlighted how decisions made outside Europe can affect access to advanced AI services.

Europe’s AI Ambitions Face Infrastructure Constraints

Europe continues to lag behind the US and China in AI investment and computing resources. Mistral is among the region’s leading AI companies, but it competes in a market where US rivals have access to substantially more capital.

The company says ML4 was trained on 3,800 Nvidia Grace Blackwell GPUs at its European data centres. It argues that the model delivers state-of-the-art performance with a fraction of the computing resources and capital invested by closed-model developers such as OpenAI and Anthropic.

European data centres can give customers greater control over where workloads run, but reliance on Nvidia chips highlights continued dependence on foreign suppliers. Data residency and model ownership can improve operational autonomy, though neither guarantees complete technological independence.

“Open source is essential to ensure state-of-the-art AI does not end up concentrated in the hands of a few actors,” said Arthur Mensch, Mistral’s CEO and co-founder.

Mensch said Mistral had raised roughly $6 billion in three years, compared with the hundreds of billions raised by other AI labs developing similar capabilities. The company aims to narrow the gap with better-funded competitors by improving computing efficiency and making its research widely available.

A Trillion-Parameter Model With Selective Computing

ML4 contains 1.05 trillion parameters but activates approximately 52 billion for each task, according to Mistral. This architecture allows it to draw on a broad range of capabilities without activating every parameter for every request, potentially improving efficiency.

Users can select low, medium or high reasoning settings depending on the complexity of a task.

Mistral says ML4 can convert two-dimensional blueprints into three-dimensional models using computer-aided design software, analyse large datasets for financial decisions, and interpret satellite and aerial imagery to identify wildfires, assess crop health and monitor risks to power lines.

What Comes Next

Mistral says ML4 is part of a new generation of multimodal models, with further releases planned in the coming months. It is available through the company’s API, and its weights can be downloaded from Hugging Face.

For European organisations, ML4 offers a way to gain greater control over AI deployment, but its reliance on advanced foreign-made chips illustrates the limits of that autonomy. Achieving lasting technological independence will require not only accessible models, but also secure infrastructure, skilled technical teams and a stronger technology supply chain.

Cyprus is earning international praise as a winter-sun destination. But for visitors weighing the cost of a Mediterranean escape, the island faces a less flattering comparison: Paphos is more expensive than several popular rivals.

Lonely Planet has named Cyprus one of Europe’s 10 best winter-sun escapes, while research from the UK’s Post Office Travel Money ranks Paphos 14th among 24 destinations worldwide for value. The contrast highlights both the island’s growing international profile and the challenge of persuading travellers that its experience justifies the price.

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Winter Sun Comes At A Premium

In its latest guide, Lonely Planet describes Cyprus as “Best for the warmest Mediterranean winter,” placing it fifth among 10 recommended European destinations. The guide highlights the island’s mild climate, archaeological sites and varied landscapes, from flamingos at Larnaca Salt Lake to snow-covered peaks in the Troodos mountains.

The recognition gives Cyprus valuable exposure as it seeks to attract visitors beyond the traditional summer season. Yet the price comparison presents a more difficult story.

According to the Post Office’s winter-sun research, a basket of eight typical holiday purchases costs £98.02 in Paphos. The same basket costs £87.46 in Tenerife and £82.35 in Portugal’s Algarve, making Paphos about 12% more expensive than Tenerife and 19% more expensive than the Algarve.

Spain’s Costa del Sol is priced at £83.58, while Lanzarote comes in at £93.82. Malta’s Sliema (£96.36) and Rhodes (£97.75) are also marginally cheaper. Among the eight European resorts surveyed, only Funchal in Madeira costs more, at £129.63.

Published in September and later covered by international outlets including Time Out, the research measures everyday purchases such as drinks, suncream, insect repellent and a three-course dinner for two with wine. It excludes flights, accommodation and transport, so it is not a measure of the full holiday cost. It does, however, offer a useful snapshot of spending once visitors arrive.

A separate 2026 Family Holiday Report, produced by the Post Office with TUI, points in the same direction. Its basket of family holiday purchases costs £177.18 in Paphos, compared with £158.31 in Tenerife and £139.65 in the Algarve. The surveys cover different periods and baskets, but both underline the competitive pressure facing Cyprus.

Quality And Recognition Strengthen The Case

Price is only one part of a destination’s value proposition. Cyprus has compelling strengths of its own, including a standout record for bathing-water quality.

The European Environment Agency’s latest assessment, published in June, ranked Cyprus first among European countries for the share of bathing sites classified as excellent. All 123 monitored locations met the highest classification for the 2025 season. The EU average was 84.8%, compared with 97.1% in Greece, 86.6% in Spain and 82% in Portugal.

The rankings assess microbiological bathing-water quality, rather than environmental conditions more broadly. Even so, the results provide a measurable point of difference in a category that matters to many holidaymakers.

International interest is also extending beyond beaches and resort towns. In June, Travel + Leisure, which had included Cyprus among its 50 best places to visit in 2026, published a feature by travel writer Joe Baur exploring a less familiar side of the island.

Rather than focusing on the coast, Baur followed sections of the island’s 347-mile E4 hiking trail, including routes through the Akamas peninsula and communities where traditional crafts, food production and local history are part of the visitor experience. The feature presented Cyprus as an underexplored destination for American travellers, with potential to attract visitors seeking outdoor activities and experiences beyond established resorts.

That kind of coverage can matter to businesses well beyond the hotel sector. Walking holidays and cultural excursions can direct spending toward guides, restaurants, food producers and smaller enterprises that may otherwise capture less of tourism’s economic impact.

Earlier this month, National Geographic Traveller published a feature by Orla Thomas on the Troodos mountains, covering the region’s wineries, walking routes, traditional villages and crafts. The article framed the mountains as a destination in their own right, offering an alternative to Cyprus’s better-known coastal attractions.

Nicosia Adds To The Island’s Cultural Appeal

The capital is also gaining visibility as a city-break destination. Nicosia was named Europe’s top cultural destination for 2026 by the European Best Destinations platform, ahead of Florence and Vienna in an assessment combining expert evaluations with traveller ratings. Euronews reported the recognition and highlighted the city’s growing appeal.

In a separate European Best Destinations ranking released in February, Nicosia placed second overall, behind Madrid. These are rankings produced by a tourism platform, not official European Union awards. Still, they add to the evidence that international interest in Cyprus reaches beyond the familiar promise of a summer beach holiday.

Turning Visibility Into Visitor Spending

For tourism businesses, the distinction between price and value is crucial. Higher prices do not automatically signal poor value: travellers may pay more for stronger service, distinctive experiences or something they cannot easily find elsewhere. International recognition cannot guarantee bookings, but it gives Cyprus another way to stand out in a crowded market.

There is also a broader economic opportunity in attracting visitors whose spending reaches beyond accommodation and beachside businesses. Cultural attractions, local food producers, specialist guides and enterprises in towns and villages can all benefit when visitors explore more of the island.

The central challenge is converting favourable coverage and rankings into commercial returns. With competition for holiday spending intense, Cyprus must make a clear case for what visitors receive in exchange for paying more. Its winter climate, natural assets and cultural experiences are strong foundations—but the value proposition has to be visible in the holiday itself.

yprus is revising the framework for companies with foreign interests, introducing stricter compliance checks and new requirements designed to attract businesses that make a substantive contribution to the economy.

The Cabinet approved the changes on Tuesday following a proposal from the Ministry of Energy, Commerce and Industry. In a post on X, Energy Minister Michalis Damianos said the revised framework aims to attract companies with a genuine presence in Cyprus and the potential to create added value.

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Greater Focus On Real Economic Activity

The revised framework prioritises companies’ actual economic activity, regardless of the origin of their capital. As part of the changes, the existing register will be renamed the “Business Facilitation Centre Register”.

The new rules also strengthen compliance monitoring and establish procedures for removing companies that fail to meet their obligations. Checks on the 70%–30% employment ratio will be conducted seven years after registration.

Annual Employment Reporting From 2027

From January 1, 2027, registered companies will be required to submit annual employment reports. The measure is intended to improve transparency and help authorities monitor compliance with the framework.

The revisions also clarify the conditions under which companies may retain their registration if their ultimate beneficial owners obtain Cypriot or other EU citizenship.

Part Of A Wider Business And Talent Strategy

According to Damianos, the changes aim to attract companies with a substantive presence, growth potential and a measurable contribution to Cyprus’s economy. The framework introduces clearer procedures and oversight while reinforcing existing obligations.

The decision forms part of a broader review of Cyprus’s Strategy for Attracting Businesses and Talent, which is expected to be completed by December 2026.

The first consultation workshop with the business community and other stakeholders took place on October 28, with a second scheduled for October 29.

Minthis is investing €6 million in its golf course and clubhouse in Paphos, with upgrades aimed at improving playing conditions, optimising water use and enhancing facilities for members and visitors.

The programme includes a redesigned irrigation system, extensive bunker renovations and improvements to the clubhouse. The investment marks another stage in the resort’s development, with a focus on modernising its golf offering while preserving its natural setting and heritage.

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New Irrigation System To Improve Water Efficiency

A redesigned irrigation system, developed by Irritech and installed by Pro Golf Group, is central to the investment. It is designed to provide comprehensive course coverage while giving the agronomy team greater precision and control over water application.

The system is expected to reduce irrigation time and minimise disruption to play, helping maintain healthier turf and more consistent playing conditions.

The installation incorporates Toro technology, including Infinity sprinklers, which allow water to be distributed according to the needs of different areas. A Grundfos acid injection system will also provide greater control over irrigation-water pH, supporting suitable conditions for turf growth.

Together, these technologies are intended to improve irrigation efficiency and consistency while strengthening the resort’s approach to water management.

Bunker Renovations And Clubhouse Upgrades

Minthis is also renovating its bunkers using a modern capillary concrete liner system. The technology is designed to improve drainage, stability and consistency, helping bunkers perform more reliably throughout the year.

Improvements to the Minthis Clubhouse are scheduled to begin in January 2027, with the main phase expected to continue through June. Plans include a new Sports Bar, restaurant upgrades, an expanded Pro Shop with a stronger retail presence and a new Caddy Master area.

The changes aim to create a more welcoming environment and extend the visitor experience beyond the golf course.

Investment Supports Wider Resort Strategy

The programme follows the introduction of TrackMan Range earlier in 2026, which expanded the resort’s practice and training facilities. Together, the projects form part of Minthis’s broader strategy to develop its golf and lifestyle offering.

“This investment represents an important milestone in the continued evolution of Minthis,” said Demetris Ashiotis, managing director of Minthis. “We are investing not only in the visible elements of the golf experience, but also in the infrastructure and technology that support the course for the long term.”

Ashiotis added that the aim was to raise the resort’s standards while preserving the qualities that define it.

“Our goal is to continually raise the standard of Minthis while remaining true to the character, heritage and natural setting that make the resort so unique,” he said.

The company expects the combination of irrigation technology, improved water management, upgraded bunkers and enhanced clubhouse facilities to deliver a more contemporary golf experience while supporting the course’s long-term quality and sustainability.

Cyprus and China are seeking to deepen trade and investment ties, with opportunities in tourism, shipping, renewable energy, technology and financial services discussed at a bilateral business forum in Nicosia on Tuesday.

The China-Cyprus Subnational Exchange and Cooperation Forum and Business Forum brought together business leaders, local officials and institutional representatives from both countries. The event was organised by the Cyprus Chamber of Commerce and Industry (Keve), the Chinese embassy and the Cyprus-China Business Association.

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Turning Strategic Ties Into Business Opportunities

Keve secretary general Philokypros Roussounides said the relationship between the two countries provided a strong foundation for closer economic cooperation. The priority, he noted, was to translate their strategic partnership into practical initiatives that deliver measurable benefits for businesses and both economies.

China’s strengths in technology, innovation and manufacturing offer opportunities for Cypriot companies, while Cyprus can provide Chinese investors with access to the EU market. Its geographic position, skilled workforce, business environment and professional services sector were highlighted as key advantages.

Roussounides also stressed the importance of cooperation between local authorities, institutions and business organisations in developing lasting commercial partnerships. Keve intends to continue facilitating trade, investment and connections between the two business communities.

Tourism Agreement Signals Potential For Cooperation

Tourism emerged as one area for more direct collaboration, with a planned cooperation agreement between Cypriot company Top Kinisis and Zhejiang Overseas (Ningbo) International Travel Service Co. Ltd. highlighting the potential for closer commercial ties.

Discussions also covered shipping, education, financial services, renewable energy and smart-city development. Other areas included modern urban planning, knowledge-sharing between local authorities, innovation, Centres of Excellence and cultural heritage preservation.

Cities And Businesses Identify Areas For Collaboration

Chinese ambassador to Cyprus Yang Yundong called for more practical cooperation through sister-city partnerships, tourism, innovation and emerging technologies. He also presented Cyprus as a potential link between China and the European Union, helping businesses explore opportunities in both markets.

Representatives from Chinese cities outlined possible areas for collaboration, including renewable energy, electric mobility, digital innovation, manufacturing, agriculture, transport and logistics. They highlighted the role of stronger relationships between local and regional authorities in advancing these initiatives.

Cypriot representatives, including Union of Cyprus Municipalities president and Larnaca mayor Andreas Vyras, Nicosia mayor Charalambos Prountzos, Invest Cyprus chief executive Marios Tannousis and Amathounta deputy mayor Marinos Kyriacou, highlighted the island’s investment potential and the benefits of cooperation across business, government and education.

Kyriakos Iordanou, permanent secretary at the Ministry of Energy, Commerce and Industry, stressed the importance of bilateral trade and Cyprus’ role as a gateway to the EU. Cyprus-China Business Association president Theo Parperis also pointed to opportunities to expand commercial relations by making better use of the island’s strategic location.

Business Meetings Aim To Deliver Results

The forum concluded with business-to-business meetings designed to help Cypriot and Chinese companies establish direct contacts and explore trade and investment agreements. The programme also included the scheduled signing of the tourism cooperation agreement between Top Kinisis and Zhejiang Overseas (Ningbo) International Travel Service Co. Ltd.

The event forms part of broader efforts to expand the international reach of Cypriot businesses and strengthen economic relations with China. Its longer-term impact will depend on whether the discussions lead to concrete agreements and sustained commercial partnerships.

Apple’s first touchscreen MacBook Pro starts at $2,899, but the price rises to $14,549 for the most expensive 16-inch configuration. The new lineup combines a move towards touch input with high-end hardware options that can add thousands of dollars to the final bill.

According to MacRumors, Apple’s online store lists the fully upgraded 14-inch model at $14,249 and the 16-inch version at $14,549.

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Storage And Memory Account For Much Of The Cost

Both top-tier configurations feature Apple’s M5 Max chip, with an 18-core CPU and a 40-core GPU. Storage and memory upgrades account for a substantial part of the price difference.

Upgrading to a 4TB SSD costs an additional $1,000, while an 8TB drive adds $3,000. Apple’s new 16TB option costs another $7,000. Buyers can spend a further $2,000 for 128GB of memory, while nano-texture glass adds $150.

The pricing comes amid pressure on memory supplies and growing demand for hardware capable of handling artificial intelligence workloads. These market conditions may help explain the higher costs, although the fully upgraded models remain well beyond the budgets of most consumers.

A $4,400 Increase Over The Previous Generation

The maximum price represents a significant jump from the previous generation. The most expensive 16-inch MacBook Pro previously cost $10,149, meaning the new model’s ceiling is $4,400 higher.

For professionals working with demanding graphics, large datasets or memory-intensive applications, the expanded specifications may be valuable. However, the additional capabilities will need to justify the premium, particularly for buyers who do not require the highest available memory and storage capacities.

Apple Brings Touchscreens To The MacBook Pro

Beyond the price, the launch marks a notable change in Apple’s approach to the Mac. Nearly a decade after introducing the Touch Bar, the company is moving to a full touchscreen display. The Touch Bar was later discontinued, making the new model a broader shift towards touch-based interaction on the Mac.

Preorders open on October 30, with availability starting on November 6. Customers can compare configurations and upgrades through the Apple Store.

Euro area businesses faced higher borrowing costs and tighter access to bank loans in the third quarter of 2026, while concerns about the economic outlook continued to limit their ability to secure external financing. The findings come from the European Central Bank’s (ECB) latest Survey on the Access to Finance of Enterprises.

Companies reported rising interest rates, stricter collateral requirements and expectations that external financing would become less available over the following three months. However, reported demand for bank loans declined, leaving the financing gap indicator slightly lower than in the previous survey round.

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Borrowing Costs And Collateral Requirements Rise

A net 46% of firms reported higher bank loan interest rates, up from 42% in the second quarter. Large companies were particularly affected, with the net share rising to 55% from 41%.

Among small and medium-sized enterprises (SMEs), the share reporting higher interest rates fell to 38% from 43%.

Other financing costs, including bank charges, fees and commissions, also increased, although less widely than in the previous quarter. A net 27% of firms reported higher costs, down from 31%.

Collateral requirements tightened as well, with a net 14% of businesses saying banks had demanded more security, compared with 10% in the previous survey round.

Bank Loan Availability Deteriorates

A net 5% of firms reported that bank loan availability had declined, compared with 1% in the previous quarter. Both SMEs and large companies experienced tighter conditions.

Among SMEs, a net 5% reported reduced availability, up from 4% in the second quarter. For large firms, the balance shifted to 6%, reversing the previous quarter’s net 4% that had reported improved access to loans.

At the same time, demand for bank loans weakened. A net 2% of firms reported a decrease in financing needs, compared with a net 2% increase in the previous quarter. Among SMEs, the balance stood at -1%, while large companies recorded a net 6% decline, reversing the previous quarter’s net 3% increase.

The bank loan financing gap indicator stood at a net 2%, down from 3% in the previous survey round. It measures changes in loan demand relative to availability, with a positive reading indicating that access to credit is deteriorating compared with firms’ financing needs.

Economic Uncertainty Limits Access To Finance

The general economic outlook remained the main factor restricting businesses’ access to external finance. A net 31% of firms said it had a negative impact, up from 29% in the previous survey round.

Large companies were more pessimistic than SMEs: net shares of 35% and 29%, respectively, reported that economic conditions were limiting their access to finance.

Companies’ own business prospects, measured through sales and profits, also continued to weigh on financing conditions. However, the net share reporting a negative impact eased slightly to 9% from 10%.

By contrast, firms’ capital positions and creditworthiness continued to support their access to external financing.

Sample Changes Affect Inflation Expectations

The ECB cautioned that substantial changes to the survey sample make some results harder to compare with earlier rounds, particularly those concerning expected selling prices, input costs and inflation. First-time respondents accounted for the majority of businesses surveyed.

Among firms that participated in both the latest and previous rounds, expectations for selling prices increased only modestly. The rise was more pronounced across the full sample.

Inflation expectations showed a similar pattern. Median expectations remained broadly unchanged among repeat respondents but increased significantly when all respondents were included. Firms’ assessment of risks surrounding their five-year inflation outlook remained broadly stable.

Survey Findings And Business Implications

The 40th round of the ECB’s Survey on the Access to Finance of Enterprises was conducted from 26 August to 2 October 2026 and covered 12,822 businesses. Of these, 11,917, or 93%, had fewer than 250 employees.

Around half of respondents assessed financing conditions and other developments between July and September, while the remainder considered the longer period from April to September. The survey also examined businesses’ expectations for euro area inflation, selling prices and other costs.

The results point to continued pressure on companies seeking bank finance, driven by higher borrowing costs, stricter lending conditions and uncertainty about the economic outlook. Although reported demand for loans declined, the availability of credit weakened relative to firms’ needs, highlighting the challenges businesses face in financing their activities.

Cyprus’s economy grew by 3.3% year on year in the second quarter of 2026, accelerating from 3.0% in the previous quarter. Private consumption and investment were the main drivers, giving Cyprus the euro area’s fourth-fastest growth rate, according to Eurobank Research.

The expansion came despite a more challenging international environment following the outbreak of the US-Iran war. Early indicators point to continued momentum in the third quarter, although renewed inflation, weaker tourist arrivals and geopolitical uncertainty pose risks to the outlook.

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Investment And Consumer Spending Drive Growth

Private consumption increased by 5.4% year on year, while gross fixed capital formation rose by 9.4%. The investment surge was largely driven by a 151.9% increase in transport equipment, while residential investment grew by a more moderate 4.3%.

Household spending continued to benefit from a resilient labour market. Unemployment stood at 3.6% in the second quarter, close to the lowest levels recorded for this period of the year. Hourly wages rose by 3.9%, marking their strongest increase in five quarters, while consumer credit expanded by 12.0% year on year.

Public consumption also supported growth, rising by 4.5%. Exports increased by 9.6%, largely due to services, but imports grew faster at 12.9%, reflecting increased purchases of transport equipment. As a result, the external surplus narrowed by 45.1%, and net exports detracted from GDP growth.

Stronger activity in wholesale and retail trade, information and communications technology, financial and insurance services, and construction also contributed to the acceleration.

Property Market Signals Continued Investment

Early third-quarter data suggest that investment activity has remained strong despite geopolitical tensions in the Persian Gulf. Property sales rose by 10.7% year on year in July and August, bringing growth for the first eight months of 2026 to 13.7%. The market is on course for a new annual record.

Residential property prices increased by 8.5% year on year in the second quarter, taking the relevant index to a new high. Non-resident buyers accounted for 59% of the increase in property sales between January and August.

Construction activity is also expected to remain robust. The total area covered by building permits rose by 43.1% year on year between January and May. Investment in transport equipment and intellectual property products is expected to provide further support to fixed capital formation during the rest of 2026, partly reflecting favourable base effects.

Tourism Holds Up Despite Geopolitical Uncertainty

Tourism has proved more resilient than initially expected. Arrivals fell by 28.6% year on year in March and April, but the decline eased to 1.7% in June and 1.1% in July before widening to 3.3% in August.

Overall, tourist arrivals were down 7.0% year on year between January and August. This remains broadly within the 4.7% to 5.8% full-year decline projected by Cyprus Insights in September. Under those forecasts, tourism activity would remain above 2024 levels despite the difficult geopolitical backdrop.

Real estate and intellectual property services are also expected to support export growth.

Inflation Puts Pressure On Household Spending

The consumer outlook remains mixed. Headline inflation accelerated to 5.2% year on year in August, up from 4.4% in July, primarily due to higher energy prices. This increase came despite existing support measures and raises questions about inflation as those measures are gradually withdrawn.

Labour-market conditions remain broadly supportive of domestic demand. Although registered unemployment was 9.4% higher year on year in the second quarter, the unemployment rate fell compared with the previous quarter, even as the labour force expanded by 1.6%.

Non-permanent residents accounted for 65.1% of that increase, highlighting Cyprus’s continued reliance on workers from abroad. The inflow comes as employers face labour shortages, reflected in a job-vacancy rate of 2.6% in the second quarter.

There are also early signs of improvement: the annual increase in registered unemployment slowed to 6.5% in July and August.

Credit Rating Upgrade Reflects Stronger Fundamentals

Cyprus’s economic outlook has received a further boost from S&P Global Ratings, which upgraded the country’s sovereign rating to A from A- and assigned a positive outlook. The agency cited continued declines in external and government debt, supported by robust real economic growth.

The second-quarter figures highlight Cyprus’s capacity to expand amid external uncertainty. Sustaining that momentum will depend on the strength of domestic demand, tourism performance and the extent to which energy-driven inflation and geopolitical risks affect households and businesses.

Real household income per capita across the EU and euro area rose by 0.1% in the second quarter of 2026, while real consumption increased at a faster pace. The latest figures from Eurostat show modest quarterly income growth alongside a longer-term rise in household gross disposable income, including in Cyprus.

In Cyprus, gross disposable income for households and non-profit institutions reached €22.97 billion in 2025, up from €16.04 billion in 2020.

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Household Spending Outpaces Income Growth

Real household income per capita in the euro area increased by 0.1% for a second consecutive quarter. Real consumption per capita rose by 0.3%, recovering from no growth in the first quarter.

Across the EU, real income per capita also grew by 0.1%, down from 0.3% in the previous quarter. Consumption increased by 0.4%, following a 0.1% decline in the first three months of the year.

As the figures are adjusted for inflation, they reflect changes in household income and spending in real terms.

What Drove Income Changes?

Net property income and other net current transfers were the main contributors to real household income growth in the euro area. Across the EU, the largest positive contributions came from employee compensation and social benefits other than social transfers in kind.

However, other components limited growth. Gross operating surplus and gross mixed income had the largest negative impact in the euro area, while current taxes and net social contributions weighed most heavily on household income across the EU.

Household Saving Rates Edge Down

The share of income that households saved declined in the second quarter, falling by 0.2 percentage points in the euro area and 0.3 points across the EU.

Among member states with available data, saving rates increased in four countries and fell in 11. Poland and Czechia recorded the largest rises, at 0.6 percentage points each. Finland saw the steepest decline, at 1.6 points, followed by Hungary at 1.4 points and Italy at 1.2 points.

Household investment rates changed little. The rate remained stable in the euro area and decreased by 0.1 percentage points in the EU. Hungary recorded the largest increase among the countries covered, at 0.7 points, followed by Czechia at 0.3 points. Ireland saw the largest decline, at 0.7 points, while Italy’s rate fell by 0.3 points.

Cyprus Disposable Income Rises For Five Consecutive Years

Cyprus recorded steady annual growth in gross disposable income between 2020 and 2025. The total rose from €16.04 billion in 2020 to €16.80 billion in 2021 and €18.08 billion in 2022.

Growth continued in subsequent years, with income reaching €19.62 billion in 2023 and €21.54 billion in 2024 before climbing to €22.97 billion in 2025.

EU And Euro Area Income Totals Continue To Grow

Gross disposable income also increased across the EU and euro area over the same period.

Across the EU’s 27 member states, the total rose from €8.55 trillion in 2020 to €9.74 trillion in 2022, exceeding €10 trillion in 2023. It reached €11.11 trillion in 2024 and €11.49 trillion in 2025.

In the 21-country euro area, gross disposable income increased from €7.49 trillion in 2020 to €8.45 trillion in 2022 and €9.10 trillion in 2023. The total then rose to €9.57 trillion in 2024 and €9.84 trillion in 2025.

The annual figures point to sustained growth in gross disposable income across Cyprus, the EU and the euro area. However, the latest quarterly data show that real household income growth remains modest, even as consumption increases and saving rates edge lower.