Romania’s CA gap hits 9.1% of GDP in 12 months to August

The deficit of Romania’s current account (CA) balance in the 12-month period to August this year increased by 57% compared to the previous 12 months, to EUR 23.7 bln., according to data published by the National Bank of Romania.

The CA gap to GDP ratio, calculated based on the GDP data as of June 2022 (latest data available), reached 9.1% - up from 6.6% calculated in comparable terms last August.

After more moderate deficits posted in April and May, the country’s CA deficit surged in the following months, offsetting the fragile improvement.

The net imports of goods, EUR 29.8 bln (+40% YoY) in the most recent 12-month period, and the net outflows of interest and dividends under the primary balance (EUR 7.3 bln, up 60% YoY) were only marginally offset by the net export of services (EUR 11.7 bln, +29% YoY) or the small transfers under the Secondary incomes (EUR 1.6 bln, +1% YoY).

Notably, most of the transfers under the EU’s RRF (Resilience Facility) and MFF (regular budget) are not visible in the current account but in the capital account.

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