International credit rating agency Standard & Poor’s has upgraded its assessment of Cyprus by one notch to BB with the agency saying the outlook is positive.
The agency expects that the Cypriot economy will expand by about 2.7 per cent this year, surpassing their earlier forecast in March 2016, with annual growth at about 2.5 per cent in real terms in 2017-2019.
S&P has also stated that the recovery is supported by flexible business services, tourism and by the gradually reviving private consumption and construction. The restructuring on the financial sector is advancing as well, but according to the agency it will take some years more until the sector will contribute to the economic growth.
According to the agency the positive outlook reflects its view that “we could upgrade Cyprus within the next 12 months if its reduction of currently high levels of non-performing loans accelerates, indicating a convergence of Cyprus’ credit and monetary conditions, including the monetary transmission mechanism, with those of the Eurozone”.
Source: Cyprus News Agency