Cyprus’ Moody’s rating: which is which

Last week the Cyprus News Agency and Ministry of Finance reported that Moody’s Investors Service had upgraded its credit opinion on Cyprus.

This puzzled many observers, since Moody’s normally sends out a press release within a nanosecond of any upgrades, so maybe the Cypriot side was out of date.

Moody’s has kindly sent us all recent reports on Cyprus and we can now clarify the following.

The rating for government bonds (the one referred to by the Ministry of Finance last week) is A2 and the outlook is positive. According to the Moody’s Credit Opinion published at the end of May, the outlook was changed to positive in March 2006.

The rating for commercial paper is P-1.

In May, as noted by the Financial Mirror, Moody’s also announced a revamp of its methodology for foreign currency ratings and upgraded a raft of countries including Cyprus.

Cyprus’ new foreign currency country ceiling according to the new methodology is now Aa1 (previously it was A2) for long term and P-1 for short term. The outlook is stable.

The Country Ceiling for foreign currency bank deposits is A2/P-1.