Experts take positive view of Cyprus' economy thanks to euro adoption
Analysts from a leading financial ratings company have taken a favourable outlook to the economy of Cyprus, citing the country's forthcoming adoption of the euro as a major reason.
Last week, the EU announced that Cyprus - in addition to Malta - is on course to adopt the euro by January 1st 2008, provided that it continues to press ahead with its preparation.
Consequently, Moody's Investor Service has placed the long-term government bonds under review for a possible ratings upgrade, resulting in a better recommendation for investors.
Tristan Cooper, vice president and senior analyst at Moody's, commented: "Moody's views the eventual adoption of the euro by these two countries as a credit positive because it will all but eliminate the risk of a currency crisis and thereby isolate their economies from external financial shocks."
Furthermore, Cyprus' economic reforms have improved the country's fiscal fundamentals, making it an increasingly stable investment environment, marked by reducing levels of external debt.
The EU has also recently praised the progress of the Cypriot economy, which is in the process of converging with the eurozone areas prior to Euro adoption.
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