The European Bank for Reconstruction and Development (EBRD) has downgraded to 1.2% the growth outlook of the Romanian economy for 2026, from 1.6% in September, according to the "Regional Economic Prospects" report, published on Thursday by the international financial institution.
The growth in 2026 and the 2.2% advance in 2027 are supported by a projected peak in the absorption of European funds from the RRF (Recovery and Resilience Facility) and the improvement of the trade balance. Weak external demand is an important source of downside risks.
EBRD preliminary estimate for 2025 indicates an advance of 0.9% of Romania's GDP in 2025, a level similar to that forecast in September.
Economic growth remained low in 2025, estimated at 0.9%. An increase in EU-funded investment and a recovery in commodity exports partially offset weakness in private consumption, amid a 5% drop in real wages in the second half of the year. Business confidence remains gloomy, amid the political turmoil in the first half of the year and the fiscal consolidation measures implemented in the second half of 2025.
The fiscal deficit is estimated to have narrowed from 9.3% of GDP to around 8% of GDP in 2025 and is expected to further narrow to 6.2% of GDP in 2026. The increase in VAT and energy prices led at the end of the year to the increase in the annual inflation rate to the peak level of 9.7%, the highest level in the EU.
The National Bank of Romania (BNR) has kept the interest rate restrictive, in order to combat persistent inflationary pressures.
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