Manufacturing Drives Growth In Cyprus Industrial Turnover Index

Strong Monthly Gains Signal Robust Economic Activity

Cyprus witnessed a significant uptick in its Industrial Turnover Index during March 2026, as the index climbed by 5.6% to reach 144.7 units according to the Cyprus Statistical Service (Cystat). The early part of the year marked a cumulative increase of 2.8% compared with the same period in 2025, underscoring a steady rebound underpinned by key sectoral performance.

Manufacturing Leads The Charge

The manufacturing sector emerged as the principal growth engine, with its index rising to 148.7 units, a substantial annual increase of 8.2%. Over the first quarter, manufacturing turnover improved by 3% year-on-year. Notably, subsectors such as wood products (excluding furniture) demonstrated exceptional gains, with monthly turnover surging by 23.1% and a quarterly rise of 21.5%. Additionally, sectors focusing on rubber and plastic products reported robust advances of 17.2% in March and 6.4% over the quarter.

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Sector-Specific Highlights

Other segments within manufacturing further contributed to the overall positive performance:

Basic Metals And Fabricated Metal Products: Recorded gains of 11.5% in March and 12.7% quarterly.
Food, Beverages And Tobacco: Turnover increased by 10.3% in March, with a quarterly uptick of 4.2%.
Machinery And Equipment, Motor Vehicles, And Transport Equipment: Experienced rises of 9.3% in March and 6.5% overall for the period.

In contrast, the refined petroleum and chemical products segments, alongside pharmaceutical preparations, saw declines of 3.7% in March and 2.7% for the quarter, while sectors such as electronic and optical products receded by 10.2% in March and 16.6% over the first three months.

Complementary Sectors And Market Dynamics

Beyond manufacturing, the mining and quarrying sector maintained momentum by posting an 11% annual increase in March, although its three-month growth was modest at 0.7%. The water supply and materials recovery sectors demonstrated remarkable performance, with indices recording increases of 16% in March and 9.4% quarterly. Conversely, the electricity supply segment experienced a notable contraction of 10.3% in March, contributing to a slight overall quarterly decline.

Market Performance: Local And Export

Market segmentation further illustrates the economic landscape with the local market index rising to 145.0 units, a 5.9% increase in March and a 3.9% rise over the quarter. The export market index, while up by 4% in March to stand at 142.9 units, recorded a minor quarterly decline of 3.7%.

Conclusion

The comprehensive industrial performance, as measured by the turnover index, reflects a dynamic economic environment in Cyprus, driven primarily by manufacturing and supported by strategic growth in mining, water supply, and materials recovery. As policymakers and business leaders analyze these figures, the underlying trends not only offer a snapshot of current market vitality but also provide critical insights for future economic planning and sectoral strategy.

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Bank of Cyprus Upgrade Signals Fresh Optimism For Greek And Cypriot Banks

by THEFUTURE.TEAM

June 26, 2026

Regional Banks Enter A More Favorable Cycle

Bank of Cyprus and Eurobank are well positioned to benefit from a renewed re-rating of Greek and Cypriot bank stocks, according to Cyprus-based investment firm Roemer Capital, which upgraded Bank of Cyprus to a buy rating and reaffirmed its positive view on Eurobank.

The firm cited easing geopolitical tensions, resilient economic growth in Greece and Cyprus, lower funding costs and Greece’s expected transition to developed-market status as the main factors supporting the sector.

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Roemer Capital also lowered its cost of equity assumptions, updated its forecasts following first-quarter 2026 results and extended its valuation horizon to the end of 2027, raising target prices across its banking coverage.

Bank Of Cyprus Gets The Largest Upgrade

Bank of Cyprus received the biggest revision, with Roemer Capital upgrading the stock from hold to buy and setting a target price of €11.10, implying potential total upside of 27%.

The firm highlighted the bank’s strong capital generation, profitability and projected 100% dividend payout, describing it as the strongest capital-return story among the banks under coverage. Roemer Capital maintained its buy rating on Eurobank, assigning a target price of €4.90 and forecasting potential upside of 28%. The report said the bank is well placed to benefit from loan growth, improving operating performance and merger-and-acquisition synergies.

National Bank of Greece and Piraeus Bank also retained buy ratings, with expected returns ranging from 25% to 36%. Optima Bank was upgraded to buy, while Alpha Bank remained at hold on valuation grounds.

Why Growth Still Sets The Region Apart

According to Roemer Capital, Greek and Cypriot banks continue to benefit from stronger economic fundamentals than many western European peers. The report pointed to faster economic growth, healthier balance sheets, low levels of non-performing exposures, capital ratios approaching 20% and strong customer deposit bases.

Analysts expect performing loans across the sector to grow at a compound annual rate of 6% to 8% through 2028, supported by private investment, digitalisation, green manufacturing, supply-chain expansion and a gradual recovery in household lending.

The report also said the conclusion of lending under the EU Recovery and Resilience Facility is unlikely to materially affect credit growth, as banks have already shifted back towards traditional commercial lending. Roemer Capital expects Euribor to remain between 2.2% and 2.5%, a level it believes should support both lending activity and net interest margins.

Geopolitics, Valuation And Market Structure Support The Case

The report said improving geopolitical conditions have strengthened the investment outlook, noting that Brent crude prices have largely returned to pre-war levels while Greek government bond yields have stabilised at around 3.5%. Although geopolitical risks remain, Roemer Capital believes the likelihood of a major inflationary shock or significant pressure on bank profitability has eased.

Another important catalyst identified by the firm is Greece’s expected promotion to developed-market status by FTSE Russell, STOXX and MSCI over the coming months.

According to the report, the reclassification should improve liquidity and attract a broader base of international investors. Roemer Capital also said Euronext’s acquisition of the Athens Exchange is expected to strengthen market infrastructure and increase international visibility, particularly for Bank of Cyprus and Optima Bank.

The firm noted that Bank of Cyprus has already benefited from its Athens listing, with average daily trading value increasing from less than €400,000 before its September 2024 move to nearly €6 million afterwards.

Economic Momentum Remains A Core Tailwind

Roemer Capital said both Greece and Cyprus have moved beyond post-crisis recovery and are now supported by private-sector-led growth. For Cyprus, the report highlighted recent tax reform and efforts to simplify the legal and regulatory framework, while also noting that limited foreign banking competition continues to support domestic lenders.

Overall, Roemer Capital expects Greek and Cypriot banks to remain well-positioned for profitable loan growth over the coming years.

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