The Central Bank of Cyprus (CBC) was established in 1963, shortly after Cyprus gained its independence, in accordance with the Central Bank of Cyprus Law, 1963 and the relevant articles of the Constitution. Today the CBC is governed by the Central Bank of Cyprus Law, 2002 as amended (hereafter “the CBC Law”).

Cyprus joined the euro area on 1 January 2008 and as a result the setting of interest rates is now the responsibility of the European Central Bank (ECB). The primary objective of the ECB is to ensure price stability, by targeting an inflation rate of 2% over the medium term.