Romania revises Q1 GDP growth from 2.3% to 2.4% y/y

Romania’s Q1 GDP (RON 318.6 bln) was 2.1% larger than initially estimated, according to new data released by the statistics office INS on July 8.

The GDP deflator was revalued at 15.2% y/y from 13.1% y/y. The real growth rate was only marginally revised upwards to 2.4% y/y (from 2.3% y/y) and 0.2% q/q (from 0.1% q/q), respectively.

Higher nominal GDP helps government bring down the deficit-to-GDP ratio.

Among the important elements of the latest revision: consumption was stronger than initially estimated (+6.9% y/y compared to 5.8% y/y), the inventory hasn’t increased but rather decreased (shrank by 0.4% of GDP compared to a 0.2% of GDP increase previously estimated) and the exports have actually increased (+1.7% y/y from -0.5% y/y, in volume terms).

This doesn’t change the overall picture but rather confirms it: (private) consumption remains robust and a main growth driver, although gross fix capital formation (+10.4% y/y) is increasing as well.

Detailed data showed, however, that investments went mainly into construction and, to a smaller extent, to production capacities.

The net import was revised downwards by some EUR 1 bln: from 5.5% of the total domestic demand (consumption plus investments) to only 4%.

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