Fitch Raises Cyprus Rating on Declining Debt
By Stephen Nakrosis
Fitch Ratings said it raised Cyprus' long-term issuer default ratings to A from A-, and assigned a stable outlook.
The nation's rapidly declining debt was one factor cited by Fitch in its upgrade. Cyprus is expected to have a general government surplus of 3.2% of GDP in 2026, highest in the euro zone, Fitch said. The country's general government debt is seen falling to 46.3% of GDP in 2026 from 52.4% in 2025, with expectations it will drop further, to 36.6%, in 2028.
Fitch also forecasts GDP growth of 3% in 2026 to 2028, above the euro zone average, driven by strong domestic consumption and continued positive performance in services sectors.
Fitch said Cyrpus' tourism inflows have recovered quickly after a slowdown at onset of Middle East conflict.
However, the nation faces inflation challenges, reflecting its high reliance on fossil fuel imports and elevated service prices. Fitch said harmonized inflation in the country was 5.2% in September, up from 0.9% in February. Inflation is expected to average 2.5% next year and in 2027 and 2028, from 4% this year.
The nation's current account deficit is expected to average 8.1% of GDP in 2026 to 2028, Fitch said.
Short-term risks center on inflation pressures and its effect on consumption, while external vulnerabilities are a key medium-term challenge, Fitch added.
Write to Stephen Nakrosis at stephen.nakrosis@wsj.com
(END) Dow Jones Newswires
November 06, 2026 18:23 ET (23:23 GMT)
Copyright (c) 2026 Dow Jones & Company, Inc.The articles, information, and content displayed on this webpage may include materials prepared and provided by third parties. Such third-party content is offered for informational purposes only and is not endorsed, reviewed, or verified by Morningstar.
Morningstar makes no representations or warranties regarding the accuracy, completeness, timeliness, or reliability of any third-party content displayed on this site. The views and opinions expressed in third-party content are those of the respective authors and do not necessarily reflect the views of Morningstar, its affiliates, or employees.
Morningstar is not responsible for any errors, omissions, or delays in this content, nor for any actions taken in reliance thereon. Users are advised to exercise their own judgment and seek independent financial advice before making any decisions based on such content. The third-party providers of this content are not affiliated with Morningstar, and their inclusion on this site does not imply any form of partnership, agency, or endorsement.
Popular
3 Stocks to Sell and 3 Stocks to Buy for November
3 of the Best Dividend Stocks to Own
The 10 Best Companies to Invest in Now
These Overvalued Stocks Have Plenty of Room to Fall
United States