Romania: Economy slows in Q1
June 4, 2014
In the first quarter, the economy expanded 3.8% over the same period last year according to more detailed data released on 4 June. The figure met the preliminary estimate and marked the slowest expansion since Q2 2013. Q1’s expansion was a deceleration from the 5.4% increase recorded in the previous quarter.
Q1’s result came on the back of a deceleration in the external sector while the domestic sector performed better compared to the previous quarter. Private consumption grew 6.7% over the same quarter last year (Q4: +2.9% year-on-year), which reached the fastest growth pace since Q3 2008. Government consumption rose 1.1% (Q4: +3.8% yoy). Fixed investment fell 7.8% (Q4: -2.6% qoq).
On the external side of the economy, exports decelerated from a 16.6% increase in Q4 to a 9.7% increase in Q1. Conversely, imports rose 8.5%, which was up from the 5.0% expansion recorded in the fourth quarter. As a result, the external sector’s net contribution to overall economic growth swung from plus 4.3 percentage points in Q4 to minus 1.4 percentage points in Q1.
On a quarter-on-quarter basis, GDP rose 0.1% in seasonally-adjusted terms in Q1, which met the preliminary estimate but undershot the 1.4% expansion observed in Q4.
Author: Dirina Mançellari, Senior Economist