Moody’s Upgraded Cyprus Rating to Ba1 Stable Outlook
The Moody’s credit rating agency has recently upgraded the Cyprus’ long term credit rating to Ba1 stable outlook.
Moody’s cited that “the key drivers for the rating action to upgrade Cyprus’s ratings to Ba1 are:
(1) Reduction in Cyprus’s exposure to event risks because of a decrease in banking sector risks;
(2) Resilience of the economy to the pandemic shock and robust medium-term GDP growth prospects being supported by sizeable European funds.
The stable outlook reflects Moody’s view that credit strengths and challenges are balanced at the Ba1 rating level. National support measures and sizeable EU funding limit the impact of the pandemic on the supply side of the economy and contingent liabilities from the crisis will probably remain contained. In addition, Moody’s expects debt affordability metrics to be favourable mitigating the impact of the higher debt burden compared to the pre-pandemic level on Moody’s assessment of fiscal strength.”
The Finance Minister of the Republic of Cyprus Constantinos Petrides stated that the government will continue to work tirelessly, systematically, and in cooperation with political parties to roll out the necessary reforms that will upgrade the Republic’s credibility to the highest level.