Cyprus Economic Outlook
October 27, 2020Available data suggests that the economic panorama remained subdued in Q3, following the unprecedented GDP drop in Q2. On the external front, tourist arrivals nosedived by more than 80%, on average, in Q3, while merchandise exports dropped markedly in July–August, as Covid-19 continued to suppress foreign demand. On the domestic side, consumers turned only marginally less pessimistic in Q3 compared to Q2—the peak of the health crisis—while the unemployment rate rose in August, likely dragging on household consumption. Moving to Q4, a spike in new Covid-19 infections prompted the government to introduce new restrictions in mid-October, boding ill for recovery at the tail-end of the year. More positively, on 2 October, Fitch Ratings affirmed the country’s BBB- credit rating with a stable outlook, citing its solid governance, strong institutions and sound fiscal policy.
Cyprus Economic GrowthGDP is seen dropping at the sharpest pace since 2013 this year, before rebounding in 2021 on the back of recovering domestic and foreign demand, and supported by EU funding. However, the unpredictable course of the pandemic, uncertainty around Brexit negotiations, with the UK being a major trading partner, and the country’s significant public debt load, cloud the outlook. FocusEconomics analysts see GDP growing 4.5% in 2021, which is down 0.4 percentage points from last month’s forecast. In 2022, our panel sees the economy expanding 4.0%.
Cyprus Economy Data
5 years of Cyprus economic forecasts for more than 30 economic indicators.
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Cyprus Economic News
July 1, 2021
Consumer prices rose 0.31% in June over the previous month, moderating from May's 0.63% rise.
June 29, 2021
Industrial output rose 55.9% in year-on-year terms in April, which was markedly above March's 8.3% increase.
June 3, 2021
Consumer prices rose 0.63% over the previous month in May, softening from April’s 0.82% print.
May 31, 2021
A second reading of national accounts data confirmed that the economy shrank at a softer rate of 1.6% year-on-year in the first quarter of the year, following the 4.5% contraction recorded in the prior quarter.
May 28, 2021
Industrial production bounced back notably in March, expanding 8.3% in annual terms, contrasting February’s 8.1% decline and logging the best reading in more than two years.