“The fiscal consolidation package recently approved by the Romanian government looks strong enough to avoid a loss of investment grade this fall. Most of the consolidation efforts this year come from increasing the VAT rate and optimizing/postponing investments. The estimated impact is 1.2% of GDP in 2025 and 2.2% in 2026.”
Erste also sees Romania’s central bank keeping the key rate unchanged. It has already done so in its latest monetary policy meeting on July 8, 2025, when it kept it at 6.5% a year.
“We see the key rate unchanged until the February 2026 meeting and a total of 150bp of rate cuts next year.”
Headline inflation should reach 7.5% by yearend, while core inflation should reach 6%, Erste says.
(English version by Loredana Fratila-Cristescu)