Nicosia puts market foray off for now

Nicosia puts market foray off for now

Cyprus faces a challenging time as it navigates plans for a foray into the financial markets.

Initially planning to start borrowing from international markets by the first half of 2024 to secure 1 billion euros, the bond issue strategy is now expected to unfold in September. This delay stems from various factors, including the unfavorable international political developments and the closure of markets in July and August.

Recent political turmoil in France, with the dissolution of Parliament and upcoming elections, has added to the uncertainty. French bond markets have experienced volatility, affecting the broader euro markets. Consequently, Cyprus may not capitalize on its recent debt upgrade by Fitch rating agency as originally hoped.

Standard & Poor’s is expected to release another rating for Cyprus soon, which could have provided momentum for a market foray. However, it appears likely that Cyprus will postpone leveraging positive ratings until later in the year. This postponement marks the second time Cyprus has delayed its market-tapping plans, initially slated for April and then June. It wants to tap the markets to enhance its fiscal resilience and reduce dependency on external borrowing.

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