Cyprus Economic Forecast

Cyprus Economic Outlook

January 30, 2018

Economic growth likely moderated in Q4 from the near one-decade high logged in Q3. The tourism sector nevertheless continued its strong performance in Q4; for 2017 as a whole, it registered a double-digit growth rate. Data also showed that unemployment continued to decrease throughout Q4. However, the economic sentiment index worsened in December; both business and consumer confidence dropped. On 28 January, President Nicos Anastasiades won the first round of the presidential elections but failed to secure an outright majority; he will face Stavros Malas in a run-off on 4 February. Anastasiades has taken credit for the economic recovery, even though a high number of non-performing loans remain in the banking sector. He has also pledged to restart reunification talks after they failed in July 2017.

Cyprus Economic Growth

Robust global demand and ongoing improvements in the labor market are expected to buttress growth this year. FocusEconomics Consensus Forecast analysts project growth of 2.9%, which is down 0.1 percentage points from last month’s estimate. For 2019, GDP is expected to expand 2.6%.

Cyprus Economy Data

Population (million)
GDP per capita (EUR)22,62220,90120,51320,82321,110
GDP (EUR bn)19.518.117.617.617.9
Economic Growth (GDP, annual variation in %)-3.2-6.0-
Consumption (annual variation in %)-1.3-
Investment (annual variation in %)-20.5-12.9-17.512.026.0
Exports (G&S, annual variation in %)-
Imports (G&S, annual variation in %)-4.4-
Industrial Production (annual variation in %)-18.7-
Retail Sales (annual variation in %)-  -
Unemployment Rate11.915.916.214.913.1
Fiscal Balance (% of GDP)-5.6-5.1-8.8-1.20.4
Public Debt (% of GDP)79.3102107108108
Inflation Rate (HICP, annual variation in %, eop)1.5-1.3-1.0-0.60.1
Inflation Rate (HICP, annual variation in %)3.10.4-0.3-1.6-1.2
Inflation (PPI, annual variation in %)6.6-2.1-2.9-  -  
Policy Interest Rate (%)0.750.250.05-  -  
Exchange Rate (vs USD)1.321.381.21-  -  
Exchange Rate (vs USD, aop)1.291.331.33-  -  
Current Account (% of GDP)-5.6-4.5-4.5-3.6-5.0
Current Account Balance (EUR bn)-1.1-0.8-0.8-0.6-0.9
Trade Balance (EUR billion)-4.3-3.2-3.7-3.4-4.4

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Cyprus Facts

Exchange Rate1.230.65 %Feb 22
Stock Market69.3-0.44 %Feb 22

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