Cyprus economic growth outlook for 2026 revised upwards

The Economic Research Centre of the University of Cyprus released updated forecasts on October 30, 2026, indicating an upward revision for the country’s GDP growth. While the economy is expected to decelerate from 4.8% growth in 2025 to 3.2% in 2026 and 3.1% in 2027, the 2026 projection has been increased by 0.5 percentage points compared to July estimates. This revision is driven by stronger-than-anticipated performance during the second and third quarters of 2026, supported by high economic confidence, low unemployment, and rising investment figures.

Despite this growth, the report warns of accelerating inflation, which is projected to jump to 3.1% in 2026 from 0.1% in 2025. The economic landscape remains constrained by persistent energy price pressures and tighter monetary conditions. Officials noted that revised historical GDP data published on October 20, 2026, contributed to the positive outlook for the 2026–2027 period, allowing the economy to maintain satisfactory expansion rates even amidst international instability.