Romania is not at risk of defaulting on its external obligations, given the adequate level of international reserves, National Bank of Romania (BNR) governor Mugur Isărescu said while presenting the central bank’s quarterly Inflation Report on May 19.

The governor rejected what he described as “catastrophic” assessments suggesting Romania is close to financial collapse or sovereign default.

“We are not there, I do not share this point of view – it is catastrophic and does us no good,” Isărescu said, as reported by Ziarul Financiar. “In general, default is when you do not pay your external obligations. We do not have this situation. There is an adequate level of international reserves. Under no circumstances are we in a position to stop external payments.”

At the end of March 2026, the ratio of the National Bank of Romania’s foreign exchange reserves to short-term external debt by remaining maturity came in at 108.1%, as against 104.4% at the end of 2025. On April  30, 2026, the National Bank of Romania’s foreign exchange reserves stood at EUR 64.8 billion, compared to EUR 62.2 billion a year earlier.

Mugur Isărescu explained that comparisons between Romania’s total public debt and the level of international reserves can be misleading because not all debt matures simultaneously, and part of it is regularly refinanced.

Romania’s public debt has approached 60% of GDP, while the government is targeting a reduction of the budget deficit to between 6% and 6.5% of GDP this year under its fiscal consolidation commitments agreed with the European Commission.

Referring to domestic fiscal pressures, the BNR governor acknowledged that Romania continues to face challenges related to the budget deficit, but argued that the state remains capable of managing such situations.

“Even if revenues are not achieved, or payments are higher than expected, a state can cope; it tightens its belt,” Isărescu stated.
The governor also implied that adjustments in the public sector remain necessary as part of broader fiscal correction efforts.

His comments come amid heightened scrutiny from investors and rating agencies over Romania’s fiscal trajectory, slowing economy, and political uncertainty. Both Fitch and S&P recently maintained Romania’s sovereign ratings while keeping negative outlooks, citing risks related to fiscal consolidation and political fragmentation.

BNR on May 19 also revised its inflation forecast for the end of 2026 to 5.5%, from 3.9% previously, citing the impact of higher energy and commodity prices linked to tensions in the Middle East.

iulian@romania-insider.com

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