Standard & Poor's upgrades Cyprus credit rating to A

On September 18, 2026, the international rating agency S&P Global Ratings upgraded Cyprus's long-term and short-term credit ratings to 'A/A-1' from the previous 'A-/A-2', assigning a positive outlook for the future. The upgrade serves as a significant vote of confidence in the Cypriot economy, despite the ongoing geopolitical instability in the Middle East and associated inflationary pressures.

The agency attributed its decision to the country's robust fiscal performance, citing the drastic reduction in public and external debt, along with strong labor market dynamics. S&P projects that Cyprus’s net general government debt will decline to 31% of GDP by 2029, a sharp decrease from 97% in 2020. Furthermore, the economy is expected to maintain a growth rate of 2.7% and a fiscal surplus of 2.4% for 2026. Experts noted that strong service exports and foreign direct investment continue to bolster fiscal surpluses, leaving the door open for potential further upgrades within the next two years.