Romania's industry remains in contractionary mode in February

Romania's industrial output contracted by 2.1% m/m (seasonally-adjusted terms) and 5.2% y/y in February, accumulating a 3.9% y/y decline for the first two months of the year, according to the statistics office INS.

In the core manufacturing sector, the industrial decline was even steeper: -2.7% m/m and -6.1% y/y, resulting in a 4.3% y/y contraction for the first two months of the year.

The new orders' value does not bode well for the industrial recovery expected by the government this year: it contracted by 0.2% y/y in February and by 1.8% y/y in the first two months of the year.

The state forecasting body already estimated a severe 3.6% y/y industrial contraction for Q1 versus 0.4% y/y advance projected last winter for the whole year.

Romania's Manufacturing Purchasing Managers' Index (PMI), which measures the activity level of purchasing managers in the manufacturing sector, inched down in March to 46.9 points (3.1 points below the neutral 50-point benchmark) from 48.3 in February, marking the ninth consecutive month of contraction, according to BCR, part of Erste Bank, which compiles the index.

Romania's industry has been in a contractionary mode for years, reaching in February a level that was 8.1% (7.3% for the core manufacturing sector) below the average in 2019 – before the Covid crisis.

(Photo source: Silviu Matei/Dreamstime.com)