The focus keyword for this report is Cyprus economy update, reflecting the latest developments across various sectors in the country.
- The focus keyword for this report is Cyprus economy update, reflecting the latest developments across various sectors in the country.
Cyprus economy: Draft Budget Signals Growth Intentions
Finance Minister Makis Keravnos presented the draft state budget for 2026 to the House of Representatives, totalling €10.7 billion. The House is expected to vote on this budget by December 17. Keravnos described the budget as growth-oriented, aiming to ensure economic resilience while maintaining necessary surpluses to reduce public debt. He emphasised that the budget aims to enhance social policies and security for the public.
Optimism in Tourism Sector
Thanos Michaelides, president of the Cyprus Hoteliers Association (Pasyxe), shared expectations that the tourism sector in 2025 will perform similarly to 2024, with potential for slight growth. However, he acknowledged that geopolitical uncertainties could pose challenges. Michaelides highlighted the critical role of November in determining the overall performance of the tourism sector, stressing the need for year-round tourism to ensure stable hotel operations.
Eurobank’s Role in Electricity Market Transformation
Cyprus has initiated a competitive electricity market, with Eurobank acting as a pivotal player in this transition. Officially launched on September 15, 2025, the market allows producers and suppliers to negotiate prices on a half-hourly basis. Eurobank serves as the general clearing member, facilitating transactions in the day-ahead and balancing markets, alongside ancillary services.
Trends in Lending Rates and Economic Activity
The Central Bank of Cyprus (CBC) recently reported a slowdown in lending activity for August 2025, contrasting with fluctuating borrowing costs across sectors. The interest rate for household deposits with terms of up to one year remained stable at 1.08 per cent, while non-financial corporation deposits saw a decrease. This data, part of the CBC’s September monetary and financial statistics, reflects broader trends affecting the Cyprus economy.
Signs of Economic Slowdown
According to the University of Cyprus’ Economics Research Centre (CypERC), the Cyprus Composite Leading Economic Index (CCLEI) indicated a mild slowdown in economic activity in September 2025. The index grew by 1.8 per cent year-on-year, a decrease from previous months. Factors influencing this slowdown included international economic pressures and fluctuations in electricity production and property sales.
Deloitte’s Commitment to Transparency
Deloitte Cyprus released its transparency report for the period from June 2024 to May 2025, underscoring its dedication to trust and integrity within the market. CEO Pieris Markou emphasised the importance of transparency in navigating today’s economic challenges and how it contributes to positive societal impacts.
New Affordable Housing Initiative
The Cyprus Land Development Corporation (CLDC) announced the launch of an affordable housing project in Kokkinotrimithia, named Danae V. This initiative will offer ten three-bedroom homes, priced between €247,200 and €274,200, excluding VAT. The project aligns with Cyprus’ broader goal of sustainable housing, especially as it prepares for the European Union Presidency in 2026.
Share Repurchase by Demetra Holdings
In a move to strengthen its market position, Demetra Holdings Plc announced the repurchase of 5,000 shares at 1.665 cents per share through the Cyprus Stock Exchange. This action complies with the regulations set forth by the Cyprus Securities and Exchange Commission.
Stability in Inflation Rates
Recent figures from Eurostat indicate that Cyprus recorded zero annual inflation in September 2025, distinguishing it as the only euro area country with unchanged consumer prices year-on-year. While the eurozone faced an inflation rate of 2.2 per cent, Cyprus’ price stability highlights its unique economic standing amidst broader regional trends.
