The confidence in the national economy dropped sharply in April before the May 4-18 presidential elections by 10.6 points to a value of 33.3 points, well below the 50-point neutral benchmark, according to the Macroeconomic Confidence Indicator compiled by a survey carried out by the CFA Romania Society among its members. It was the lowest level since the outbreak of the Covid-19 pandemic.
Notably, the plunge was caused exclusively by the expectations component of the indicator, which decreased by 16.9 points to 25.9 points, while the current conditions component increased by 2.1 points to 48.2 points, Ziarul Financiar reported.
The survey also indicates that 64% of participants anticipate Romania’s sovereign rating to remain in the investment-grade region over the next 12 months (down from 82% in March), while 36% (up compared to the previous year) anticipate a downgrade to the non-investment grade.
“The risk of a presidential election result that would have led Romania on a trajectory towards Euroscepticism generated a strong decrease in the expectations component, which led the confidence indicator to its lowest value since the pandemic. At the same time, the anticipated budget deficit for the current year increased to 8% of GDP, and the anticipated economic growth fell below 1%,” said Adrian Codirlaşu, president of the CFA Romania Association.
The state budget deficit forecast for 2025 increased compared to the previous month, from an average value of expectations of 7.4% of GDP in March to 7.9% of GDP in April.
Economic growth expectations for 2025 are again decreasing compared to the previous month, at an average value of 0.7% (+1.0% in March), with opinions among participants regarding a possible entry into recession of the Romanian economy.
Public debt, calculated as a percentage of GDP, is expected to increase to 57% in the next 12 months.
The analysts estimate an inflation rate for the 12-month horizon (April 2026) increasing to 4.78%.
Regarding the EUR/RON exchange rate, approximately 86% of CFA survey participants anticipate a depreciation of the leu in the next 12 months. Thus, the average value of the expectations for the 6-month horizon is RON 5.0494 per euro, while for the 12-month horizon, the average value of the anticipated EUR/RON exchange rate is RON 5.1112 per euro.
iulian@romania-insider.com
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