Economic activity remained modest at the start of 2026. The economy contracted by -1.1% YoY in Q1 2026, while on a quarterly basis GDP stabilized (0.0% QoQ, seasonally adjusted), following the sharp decline in Q4.
Inflationary pressures continued to intensify. CPI accelerated further to 10.85% YoY in May, up from April, while monthly inflation stood at 0.58% MoM, pointing to persistent underlying pressures despite some moderation in the pace of increase.
The budget deficit reached -1.75% of GDP in May (cash terms), almost half of last year’s figure (-3.35%). At the same time, economic sentiment weakened more visibly, with the confidence indicator declining to 83.5 in June, well below its long-term average, signaling deteriorating expectations.
The EUR/RON exchange rate continued to depreciate slightly, reaching an average of 5.24 in June, from 5.23 in May, indicating ongoing FX pressures. The NBR maintained the policy rate at 6.50%, while ROBOR 3M edged marginally lower to 5.84% in June, confirming relatively stable liquidity conditions.
The external position shows early signs of adjustment. The trade deficit remains elevated at 10.81 bn euro in the first four months, but has narrowed compared to the previous year (-7.0% YoY).
