The cost of borrowing for home purchases in Cyprus decreased in July, while interest rates on consumer credit rose, presenting a mixed picture for household finances, according to data released Wednesday by the Central Bank of Cyprus (CBC).
Overall, the interest rate environment in Cyprus remains close to the median for the Eurozone.
Detailed Breakdown of Loan and Deposit Rates
The CBC figures for July 2025 show divergent trends across different lending and deposit categories for both households and businesses.
For Households:
- The interest rate on loans for house purchase fell to 3.87%, down from 3.95% in the previous month.
- In contrast, the rate on consumer credit climbed to 7.40%, a notable increase from 7.01% in June.
- The interest rate offered on household deposits with a maturity of up to one year edged down to 1.08%.
For Businesses:
- The rate on corporate loans up to €1 million decreased to 4.29%.
- The rate on corporate loans over €1 million rose to the same level of 4.29%.
- The interest rate on corporate deposits saw a slight increase to 1.21%.
Volume of New Lending Contracts
In addition to the rate changes, the total volume of new lending saw a significant slowdown in July. The value of pure new loans issued during the month decreased to €445.3 million, a sharp drop from the €642.8 million recorded in June.
This decline was observed across most major categories, including new loans for house purchases and large corporate loans. The only category to see a slight increase was new loans for consumption.
Comparison with the Eurozone
According to the Central Bank, Cyprus’s overall loan interest rate levels are comparable to the rest of the Eurozone. In July, the rate on outstanding loans to households in Cyprus stood at 4.05%, slightly above the 3.96% average for the Eurozone. For non-financial corporations, the rate in Cyprus was 4.31%, compared to the 3.79% Eurozone average.
Source: Stockwatch.com.cy