The credit rating of the Republic of Cyprus remained unchanged at level A3 in the rating of Moody's International, which was published yesterday. This assessment confirms the resilience of the Cypriot economy, says the Minister of Finance, Makis Keravnos and points out the challenges that the House also highlights from the ongoing negative geopolitical developments.
A relevant announcement states that on May 29, 2026, the international rating agency Moody's published its periodic rating, keeping the credit rating of the Republic of Cyprus unchanged at level A3. As noted, this rating reflects the country's strong economic resilience and its positive medium-term growth prospects, although In the short term, a slowdown is expected due to the risks stemming from the conflict in the Middle East, with implications for tourism and inflation.
The Republic of Cyprus according to Moody's:
-has good institutional capacity and effective policy-making;
-Public debt levels continue their downward trend steadily with debt sustainability ratios remaining strong
-growth was in line with the Agency's projections, supported by the continued diversity of the economy,
-The banking sector is supported by strong capital adequacy and enhanced profitability.
It is also reported that Cyprus faces a number of challenges, such as:
-the small size of the country, which, as mentioned in previous reports by the House, makes it less resilient to shocks than a larger economy;
-budgetary expenditure pressures, which pose a continuing risk to the future course of public finances;
-the slowdown in economic growth due to the conflicts in the Middle East;
-risks in the banking sector, which continue to be a key factor in sudden developments, despite their gradual de-escalation due to structural improvements in the system.
In the House's announcement, it is pointed out that further upward upgrades could occur, provided that:
fiscal aggregates and public debt ratios perform better than the Agency's expected forecasts, and
growth in the medium term, driven by, inter alia, public and private investment and improved labour market conditions.
If the estimates for fiscal results and public debt deviate negatively from the Agency's estimates, affecting the downward trajectory of public debt, then the ratings for Cyprus could come under downward pressure.
The government will continue to implement the prudent fiscal and macroeconomic policy of recent years, allowing the state to maintain adequate tools for managing international crises, to ensure macroeconomic stability and economic growth, as well as to pursue social policy aimed at protecting vulnerable and weaker groups.
What does the Minister of Finance, Makis Keravnos, say?
Confirmation of the Credit Rating of the Republic of Cyprus and Preservation of its Prospects, by the International Rating Agency "Moody's"
The rating agency Moody's on May 29, 2026, issued a statement through which it maintained the rating of the Republic of Cyprus at level A3 and the outlook of the economy at stable.
The Moody's rating confirms the resilience of the Cypriot economy as defined by the government's rational economic policy and related reforms.
At the same time, we agree and take seriously into account the observations contained in the House's report on the existence of the challenges arising from the ongoing negative geopolitical developments.
As a government, we are well aware of the enormous efforts made within the framework of our rational economic policy to maintain the resilience of our economy and to have the positive assessments that classify the borrowing capacity of the Republic of Cyprus in investment grade.
We also know that even more effort is needed to preserve them. Therefore, sound strict and prudential fiscal policy should be pursued consistently and responsibly.
President Christodoulidis greets the news
The President of the Republic, Nikos Christodoulides, welcomed the new confirmation of the positive assessment of the Cypriot economy, this time by the international rating agency Moody's, describing it as a substantial development with clear political and economic importance for the country.
The President said that, at a time when the international economy is being tested by uncertainty, geopolitical tensions and constant pressures, Cyprus is assessed as an economy with credibility, resilience and prospects. He also noted that the house's explicit reference to strong institutional governance and effective policy-making is a recognition of an economic strategy that, as he said, is paying off in practice.
Nikos Christodoulides underlined that from the first day of taking over the government, fiscal responsibility, stability, the reduction of public debt, the strengthening of growth dynamics and the creation of real benefit for citizens were set as priorities. He added that the results confirm that this course is correct, effective and internationally recognized.
According to the President of the Republic, today's development strengthens the credibility of the Republic of Cyprus, supports the confidence of the markets and investors, shields the economy against external risks and creates greater possibilities for targeted social policy. As he noted, these possibilities concern the support of the middle class, the strengthening of households, workers, young people and businesses.
Concluding, he said that the government continues with the same seriousness, with a specific plan and a clear orientation, with the aim of preserving what has been achieved, further strengthening the resilience of the economy and turning every positive result into more security, more opportunities and better prospects for citizens and society.
