Romania’s National Commission for Strategy and Forecasting published a projected economic growth of just 0.1% for 2026, down from 1% in the previous forecast. GDP is therefore projected at RON 2.056 billion, compared to RON 1.916 billion in 2025. Similarly, the institution upped its average annual inflation in 2026 to 7.9%.

The Commission pointed to the difficult geopolitical context, specifically the war in the Middle East and the subsequent fuel crisis, as an explanation for the reduction and the inflation.

“The inflationary effect produced by rising fuel prices overlapped with domestic efforts to correct macroeconomic imbalances through the continued implementation of budget consolidation measures, which generated a deterioration in the outlook for the current year,” according to the Commission’s Projection of the Main Macroeconomic Indicators 2026–2029.

“Added to these are the below-expectation results of several high-frequency indicators from the first three months of the year, especially those reflecting household consumption (retail trade, services for the population, wage earnings, etc.),” the note accompanying the document stated.

Sectoral dynamics

The forecast for 2026 took into account the continuation of the downward trend of the industry sector. Rising costs of energy led to difficult conditions for the sector over the last four years. An unfavorable evolution was also estimated for the services sector, with the impact of fiscal consolidation measures being more pronounced for certain categories of services, especially those intended for household consumers.

At the same time, the construction sector was crowned as the most dynamic sector, supported mainly by civil engineering construction, stimulated by the absorption of European funds, as well as by a recovery in residential construction recorded in the first part of the year.

“Gross capital formation remains the main supporter of domestic demand. Nevertheless, the risk of insufficient utilization of European funds persists, which would constitute a vulnerability for the evolution of the investment process and, implicitly, for economic growth,” the Commission emphasized.

The dynamics of international trade have also been revised downward, against the backdrop of deteriorating forecasts regarding the economic growth of major external partners, as well as supply chain disruptions resulting from global conflicts. Net exports will have a positive impact due to a 1.7% increase in exports of goods and services, combined with a near-stagnation of imports of goods and services (+0.1%), resulting from the contraction of domestic demand.

Inflation

The National Commission for Strategy and Forecasting issued a separate estimate for inflation in Romania, revising upward its estimate for average annual inflation in 2026 to 7.9%, roughly 1.4% higher than the previous forecast.

The consumer price index at year-end was similarly revised upward by 1.7% to 5.3%. The main reason for the higher inflation was the intensification of the conflict in the Middle East. The impact was initially felt in the fuel category, with second-round effects gradually appearing in the prices of other categories of goods and services, especially transportation.

According to the cited source, the disinflationary trajectory, interrupted in March, is expected to resume in the third quarter, once the statistical effects of electricity tariff increases disappear and the new VAT rates and excise duties are applied.

“In the current scenario, the exchange rate forecast has also been modified, taking into account the significant increases recorded in May. The downward inflation trend remains in place throughout the forecast horizon, but this year’s increases will also be reflected in next year’s annual average. However, there remains a risk of additional upward pressure on consumer prices in 2027, stemming from the re-liberalization of natural gas prices and the removal of the cap on commercial margins for basic food products,” CNSP specialists stated.

The National Bank of Romania anticipates that the annual inflation rate will stand at 5.5% at the end of the current year, 2.9% at the end of 2027, and 2.7% in March 2028, according to the Quarterly Inflation Report released in May 2026.

Medium-term perspectives

In the medium term, estimates for economic growth remain unchanged for the entire 2027–2029 period, with the average annual growth rate for GDP standing at 2.2%, supported mainly by the continued development of the investment process. 

“However, the macroeconomic forecast is subject to a high degree of uncertainty, with the persistence of the conflict in the Middle East, deviations from budget consolidation reforms, or the tightening of international trade policies constituting risks of deterioration to macroeconomic balances,” CNSP warned.

For 2027, the National Commission for Strategy and Forecasting estimated a GDP of RON 2.201 billion, representing economic growth of 2.2%, supported by lower inflation and more favorable financing conditions. Growth will continue in the following years, reaching 2.4% in 2028 and 2.1% in 2029.

radu@romania-insider.com

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