Romania’s current account deficit in the 12 months to May contracted by 7.6% y/y to EUR 29.2 billion, with the contraction rate softening to 5.4% y/y in January-May, according to data published by the National Bank of Romania (BNR). The CA deficit to GDP ratio decreased even faster, due to the nominal increase of the GDP, to some 7.6% in 12 months to May from 8.7% in the previous 12-month period.
The 12-month rolling CA deficit demonstrates slight nominal contraction since mid-2025, when the fiscal measures have restricted public and private demand — after a visible widening trend seen over the previous 18 months during 2024 and the first half of 2025, when the general government deficit peaked at 9% of GDP.
The state forecasting body, under its latest projection issued in February, expects the CA gap to further diminish to EUR 26.8 billion in 2026 and the CA to GDP ratio to reach 6.7% at the end of the year.
The improvement in the CA balance was visibly driven by the section of trade in goods – where imports edged up by 1.0% y/y versus a 4.6% advance of exports, resulting in an 8.1% y/y smaller deficit. Proportionally, the decline may not be impressive – but this translated into a EUR 2.8 billion contraction in absolute terms. Overall, the CA deficit narrowed by less than EUR 2.4 billion in 12 months to May compared to the previous 12-month period.
The surplus posted by the balance of trade in services increased slightly (+2.5%) to EUR 12.6 billion in the 12 months to May, even if the net consumption of travel services surged by 34% y/y to nearly EUR 5.0 billion. The gross consumption of travel and tourism services increased by 12.2% y/y to EUR 10.1 billion.
The net outflow of primary incomes, standing for net interest, dividend, and wages earned by foreign investors and workers in Romania, increased by 12.2% y/y to EUR 10.2 billion. Out of this, net dividends were EUR 11.1 billion (steady y/y), EUR 4.8 billion was net interest (+17.5% y/y), while the net inflow of wage remittances increased by 6.1% y/y to nearly EUR 4.0 billion. Notably, the cost of external debt increased significantly.
Finally, the net balance of secondary incomes (transfers to the public or private sectors) turned to a EUR 368 million deficit in 12 months to May, from a deficit of EUR 11 million in the previous 12-month period.
On the financing side, the net inflow of foreign direct investments increased by 16% y/y to EUR 6.9 billion in the 12 months to May 2026. This translated into some 1.9% of GDP, not much different from the previous 12-month period but only a quarter of the CA deficit.
However, when it comes to the first five months of 2026 alone, the net FDI contracted by 23% y/y to EUR 2.0 billion: EUR 0.96 billion (-2.1% y/y) was new equity, EUR 1.4 billion (+16% y/y) was reinvested profits, while the FDI companies in Romania repaid EUR 331 million to parent groups.
The new equity investments in the rolling 12 months were only EUR 1.5 billion (less than a quarter of total net FDI), while the reinvested earnings accounted for the bulk (EUR 4.3 billion, up 43% y/y) of total FDI.
iulian@romania-insider.com
(Photo source: Alexandru Marinescu/Dreamstime.com)
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