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Cyprus Growth Outpaces EU As Three Credit Rating Reviews Approach

by News Editor

August 27, 2026

Cyprus is heading into a busy September for sovereign credit ratings, with DBRS Morningstar, S&P Global Ratings and Capital Intelligence Ratings set to review the country as economic growth remains well above the EU average.

DBRS will announce its decision on September 4, followed by S&P and Capital Intelligence on September 18. Fitch and Moody’s are scheduled to conduct their next assessments in November.

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Cyprus Holds Investment-Grade Ratings

All five major international agencies currently assign Cyprus investment-grade ratings, with recent assessments pointing to strong economic growth, sound public finances and a resilient banking sector.

DBRS confirmed Cyprus at A with a stable outlook in March, while S&P reaffirmed an A- rating with a positive outlook. Capital Intelligence maintained Cyprus at BBB+ with a stable outlook. Fitch later retained its A- rating with a positive outlook, while Moody’s kept Cyprus at A3 with a stable outlook.

Economy Grows 3.3% In First Half

Cyprus’ economy expanded 3.3% during the first half of 2026, according to Finance Minister Makis Keravnos, roughly three times the EU average. Unemployment stood at 4%.

Independent forecasts point to slower growth ahead. The Economics Research Centre of the University of Cyprus expects GDP growth to ease from an estimated 3.8% in 2025 to 2.7% in 2026 before recovering to 3.1% in 2027.

For comparison, second-quarter GDP increased 0.5% across the EU and 0.4% in the euro area from the previous quarter, according to Eurostat.

Inflation And Fiscal Policy Remain In Focus

Inflation increased from 0.5% in January to 3.1% in June, with the government forecasting a rate of around 4% by year-end. Authorities have allocated €200 million for measures aimed at easing the impact on households, while any extension of the reduced fuel tax will depend on economic developments.

Despite those pressures, Cyprus recorded a fiscal surplus equivalent to 1.1% of GDP in the first half of 2026. The government expects a full-year surplus of about €900 million and says the stronger fiscal position is supporting more than €1 billion in social policies while allowing it to repay around €1 billion of debt annually.

September Reviews Will Test The Outlook

The upcoming decisions will give investors a fresh assessment of whether Cyprus can maintain its strong economic and fiscal performance as growth moderates and inflation remains elevated.

With all major agencies already assigning investment-grade ratings, any change in Cyprus’ rating or outlook could affect its borrowing costs and position among international investors.

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Cyprus’ Strong Youth Employment Rate Still Does Not Guarantee Early Independence

by THEFUTURE.TEAM

September 16, 2026

Young people in Cyprus have a relatively high employment rate, but they leave the parental home later than the EU average, according to Eurostat data.

Cypriots left home at an average age of 27 in 2025, compared with 26.3 years across the EU. At the same time, 72.3% of people aged 20 to 29 in Cyprus were employed, well above the EU average of 65.5%.

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Strong Employment Does Not Mean Early Independence

Only nine countries recorded higher youth employment rates than Cyprus. Iceland led at 85.3%, followed by the Netherlands at 84%, Malta at 82.1%, Switzerland at 78.3% and Germany at 77%.

Norway recorded 76.5%, Ireland 76.1%, Denmark 74.8% and Austria 74.6%. Eurostat said countries where young people leave home earlier generally tend to have higher youth employment rates.

Southern Europe Sees Later Moves

Finland had the lowest average age for leaving the parental home at 21.4 years, followed by Denmark at 21.8 and Estonia and Lithuania at 22.7. Croatia recorded the highest average at 31.5 years, followed by Greece and Slovakia at 30.9. Spain and Italy both stood at 30.2 years.

Across the EU, the average has remained close to 26 since 2002, rising only slightly from 26.2 years in 2024 to 26.3 years in 2025.

Cyprus Labour Market Is Cooling

The figures come as Cyprus’ labor market shows some signs of easing, although demand for workers remains relatively strong by European standards.

Separate Eurostat data showed Cyprus had the EU’s largest annual decline in its job vacancy rate in the second quarter of 2026. The rate fell to 2.6% from 3.3% a year earlier, but remained above the EU average of 2.0% and the euro area average of 2.1%.

Cost Of Living Remains A Factor

Housing and other living costs can also affect how quickly young workers establish independent households. Eurostat reported that Cyprus’ household consumption price level was 89.2% of the EU average in 2025.

A relatively lower overall price level does not eliminate affordability pressures for people on modest incomes. For younger workers, the issue can be whether wages are sufficient to cover rent, utilities, food and other basic expenses.

Cyprus therefore combines relatively high youth employment with a later transition to independent living, suggesting that access to work and the ability to afford a separate household do not always move together.