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Cyprus credit rating raised

Two leading ratings agencies, Standard & Poor and Fitch Ratings, have both raised Cyprus’s ratings.

This is a positive development which reflects Cyprus efforts over the last year and a half to improve it’s economy and exit the financial crisis.

Standard & Poor has raised Cyprus’s long term local and foreign currency sovereign credit ratings from ‘B’ to ‘B+’. Moreover, the agency affirmed the short term ratings for local and foreign currency sovereign credit ratings at ‘B’. Standard & Poor stated that the upgrade reflects the country’s economic and budgetary performance over the last six months. The agency said that the country improved its debt profile and complied with the economic adjustment program.

Fitch Ratings revised Cyprus’s outlooks to positive from stable. Further, it affirmed the country’s long term local and foreign currency Issuer Default Ratings at ‘B-‘. Fitch stated that the revision of Cyprus’s ratings was driven by developments in public finances which exceed Fitch’s previous expectations. Fitch added that due partly to a more shallow recession than previously expected, the strong budget execution should help narrow the headline fiscal deficit to 3.3% of GDP in 2014. This is significantly below the 5% projected by Fitch in April.

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