Cyprus is rated as having a Positive Outlook. The island has been upgraded by a total of five notches since mid-2015 as it has completed the European Stability Mechanism programme.

More broadly, strong growth and improving public finances have underpinned improvements in Western European sovereign creditworthiness in recent quarters. General government deficits and debts are declining across most countries in the region. Near-term growth fundamentals remain solid, boosted by favourable financing conditions, robust employment growth and improving business profitability. Resilient domestic demand provides some offset to the drag from slowing global trade.