Romania's macroeconomic confidence index up in July on first fiscal reform package

The macroeconomic confidence index compiled by CFA Society Romania based on a survey among its members improved by 5 points in July compared to June, entirely driven by better expectations (+8.6 points), but the current conditions component (-2.2 points) reached the lowest value in the past years and both components remain deep in the "negative" half of the scale.

The overall index reached 34.9 points on a 0-100 scale, where the 50-point benchmark indicates normal economic conditions and steady expectations.

The expectations (33.6 points) lag behind current conditions (37.5 points), and both components have been on a downward trend over the past year.

The analysts' sentiment has visibly improved after the government passed the first fiscal reform package on July 9 and S&P affirmed Romania's sovereign rating (BBB-/negative). None of the analysts surveyed expects a downgrade in the following 12 months.

The projections for the budget deficit this year (cash terms) worsened to 7.6% of GDP from 7.5% in the June survey. The expectations for the economic growth this year have also deteriorated, to 0.8% from 0.9% in June.

(Photo source: Lovelyday12/Dreamstime.com)