Romania: Economy remains strong amid rebound in exports
July 4, 2013
In the first quarter, GDP expanded 2.2% over the same period last year, according to detailed data published on 4 July. The print, which matched the flash estimate released on 5 June, was above the 1.1% rise recorded in the fourth quarter and marked the fastest growth rate in six quarters.
The expansion came on the back of an improvement in the external sector, whereas domestic demand remained subdued. Private consumption contracted 0.3% in the first quarter (Q4 2012: +1.4% year-on-year), while government expenditure also contracted 0.3% (Q4: +1.2% yoy). Moreover, gross fixed investment plunged 5.4% (Q4: -0.6% yoy).
Meanwhile, the external sector's net contribution to overall economic growth rebounded strongly, as exports rose 9.1% over the previous quarter (Q4: -4.7%). Imports, on the other hand, contracted 0.1% in Q1, above the 3.8% fall seen in the previous quarter.
However, a quarter-on-quarter comparison does not corroborate the improvement suggested by the annual figures, as GDP rose 0.7% in seasonally adjusted terms in the first quarter, which was below the 1.0% rise recorded in Q4.
The government expects GDP to expand 1.6% this year before accelerating to 2.2% in 2014. FocusEconomics Consensus Forecast panellists anticipate the economy to grow 1.4% this year, which is down 0.1 percentage points over the previous month's projection. For next year, the panel expects the economy to expand 2.5%.