Romania: Economic growth slows in Q2
September 4, 2015
In the second quarter, the economy expanded 3.3% over the same period of the previous year, according to more detailed data released on 4 September. The figure met the preliminary estimate and marked a notable deceleration compared to the 4.3% expansion observed in the first quarter. On a quarter-on-quarter basis, GDP rose 0.1% in seasonally-adjusted terms in Q2, which was down from the 1.4% expansion tallied in the previous quarter. Q2’s slowdown mainly reflected a deterioration in the external sector.
Private consumption grew 5.9% in the second quarter, which was stronger than the 4.9% increase observed in Q1. Conversely, government spending fell from a 3.0% increase in Q1 to a mild 0.4% rise in Q2, which represented the smallest gain in over two years. Growth in fixed investment moderated from an 8.3% rise in Q1 to a 7.9% expansion in Q2.
On the external side of the economy, exports decelerated from a 8.4% increase in Q1 to a weaker 4.2% expansion in Q2. Imports dropped from 11.4% growth in the first quarter to a 7.8% rise in the second quarter. Because exports slowed more than imports, the external sector’s net contribution to overall economic growth decreased from minus 4.5 percentage points in Q1 to minus 5.3 percentage points in Q2, marking the largest detraction in five years.
Author: Dirina Mançellari, Senior Economist