Romania buildings

Romania Economic Forecast

Romania Economic Outlook

According to preliminary data, annual growth slowed in Q1, undershooting market expectations. Slowing external demand should have weighed on exports. That said, stronger retail sales growth suggests that private consumption was a key growth driver. The full breakdown is due on 8 June. Turning to Q2, our panelists expect growth to pick up slightly. Sturdy wage growth so far this year, April’s decelerating inflation and stronger hiring intentions over April–May versus Q1 should be continuing to support private consumption. However, in April–May, economic sentiment moderated compared to the Q1 average due to small deteriorations in industry, services and retail. In other news, the coalition government’s planned cabinet reshuffle has been delayed after teachers went on strike in May, demanding higher salaries. So far, they have rejected two pay rises proffered by the government.

Romania Inflation

Inflation decelerated to 11.2% in April (March: 14.5%), driven by lower price pressures for food, non-food goods and services. Our panelists expect inflation to return to single digits in Q3 this year on waning demand and a tougher base effect. That said, rising wages pose an upside risk.

This chart displays Economic Growth (GDP, annual variation in %) for Romania from 2013 to 2022.

Romania Economic Data

2017 2018 2019 2020 2021
Population (million) 19.6 19.5 19.4 19.3 19.2
GDP (USD bn) 210 243 251 251 285
GDP per capita (USD) 10,702 12,448 12,924 13,007 14,852
GDP (EUR bn) 186 206 224 221 241
GDP per capita (EUR) 9,491 10,550 11,547 11,410 12,564
GDP (RON bn) 852 959 1,064 1,067 1,187
Economic Growth (Nominal GDP, ann. var. %) 13.2 12.6 10.9 0.3 11.3
Economic Growth (GDP, ann. var. %) 8.2 6.0 3.8 -3.7 5.9
Private Consumption (ann. var. %) 11.6 9.3 3.2 -3.7 8.2
Government Consumption (ann. var. %) 3.1 4.9 7.9 0.6 2.0
Fixed Investment (ann. var. %) 5.4 0.2 12.4 1.4 2.0
Exports (G&S, ann. var. %) 7.9 5.3 4.6 -9.4 12.8
Imports (G&S, ann. var. %) 11.5 8.7 8.8 -5.8 15.4
Industrial Production (ann. var. %) 8.6 5.0 -3.6 -9.5 7.4
Retail Sales (ann. var. %) 10.8 5.5 7.2 2.3 10.1
Wages (ann. var. %) 14.8 35.4 13.0 6.4 7.1
Unemployment (% of active population, eop) 5.7 5.0 4.9 6.3 6.0
Unemployment (% of active population, aop) 6.1 5.3 4.9 6.1 5.6
Fiscal Balance (% of GDP) -2.5 -2.8 -4.3 -9.2 -7.1
Public Debt (% of GDP) 35.3 34.5 35.1 46.9 48.6
Money (ann. var. of M2 %) 11.5 8.9 10.9 15.3 15.8
Inflation (CPI, ann. var. %, eop) 3.3 3.3 4.0 2.1 8.2
Inflation (CPI, ann. var. %, aop) 1.3 4.6 3.8 2.6 5.0
Inflation (HICP, ann. var. %, aop) 1.1 4.1 3.9 2.3 4.1
Inflation (Core, ann. var. %, eop) 2.7 2.7 4.1 3.8 4.8
Inflation (PPI, ann. var. %, aop) 3.5 5.0 4.0 0.0 14.9
NBR Reference Rate (%, eop) 1.75 2.50 2.50 1.50 1.75
10-Year Bond Yield (%, eop) 4.42 4.91 4.51 3.08 5.26
Stock Market (ann. var. of BET %) 9.4 -4.8 35.1 -1.7 33.2
Exchange Rate (RON per USD, eop) 3.89 4.07 4.26 3.97 4.37
Exchange Rate (RON per USD, aop) 4.05 3.94 4.24 4.24 4.16
Exchange Rate (RON per EUR, eop) 4.67 4.66 4.79 4.87 4.95
Exchange Rate (RON per EUR, aop) 4.57 4.65 4.75 4.84 4.92
Current Account Balance (EUR bn) -5.8 -9.5 -10.9 -10.9 -17.5
Current Account Balance (% of GDP) -3.1 -4.6 -4.9 -4.9 -7.2
Merchandise Trade Balance (EUR bn) -12.8 -15.3 -17.9 -18.9 -23.1
Merchandise Exports (EUR bn) 57.2 61.8 63.1 57.6 70.2
Merchandise Imports (EUR bn) 70.0 77.2 80.9 76.5 93.3
Merchandise Exports (ann. var. %) 9.6 8.1 2.0 -8.7 21.9
Merchandise Imports (ann. var. %) 13.2 10.2 4.9 -5.4 22.0
Foreign Direct Investment (EUR bn) 4.5 5.4 5.2 2.8 7.6
International Reserves (EUR bn) 37.1 36.8 37.5 42.5 45.8
International Reserves (months of imports) 6.4 5.7 5.6 6.7 5.9
External Debt (EUR bn) 97.4 99.8 109.8 126.7 136.6
External Debt (% of GDP) 52.3 48.4 49.0 57.5 56.6

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