Romania: Economy decelerates in Q4, but brings full-year growth to a nine-year high
In the fourth quarter, the economy expanded a strong 6.9% over the same period last year, according to a preliminary estimate released by the National Institute of Statistics on 14 February. The figure marked a deceleration from Q3’s impressive 8.8% year-on-year expansion and was broadly in line with market expectations. The robust expansion in Q4 brings the growth for the whole year in 2017 to 7.0%, the highest reading in 9 years.
Although a breakdown by components is not yet available, buoyant retail sales and declining unemployment throughout Q4 suggest household spending underpinned growth. Moreover, strong industrial production readings point to an extension of the recovery in fixed investment. On the other hand, recently published data shows that the current account deficit widened considerably in 2017, suggesting the external sector continued to drag on growth in the final quarter of 2017.
On a quarter-on-quarter basis, GDP growth adjusted for seasonal effects increased 0.6% in Q4, marking a notable deceleration from Q3’s 2.4% expansion. The Statistical Office (INSSE) will release more detailed data on 7 March.