Romania's industrial production returned in September to the same level seen in the same month last year, while the manufacturing sector's output increased marginally by 0.4% year-on-year.

This was the best annual performance after 15 months of negative growth rates.

For the entire third quarter, the industrial production contracted by 3.4% year-on-year, a visible improvement from the 26.7% yoy plunge seen in Q2. The industrial output also rose by 7.4% quarter-on-quarter in seasonally adjusted terms after the 15% plunge in Q2.

The quarterly data indicate a partial recovery in Q3 after Q2 - even if the short-term series indicates a nearly complete recovery as of September compared to before the crisis (February).

Under a combination of a tight labor market, a shift to higher value-added production segments, and sluggish external demand, Romania's industrial production started to decline in mid-2019, a trend that accelerated during the crisis (April-May). The recovery episode began in June.

In September, the overall industrial production (extractive, manufacturing, and utilities), in seasonally adjusted terms, was only 4.4% lower compared to February.

In the manufacturing sector, the lag is only 3.9%, so overall the production nearly returned to the pre-crisis level. However, there are wide variations across manufacturing industries. Production of pharmaceuticals surged by 25% year-on-year, the chemical industry posted a robust 14% yoy growth as well, and even the automobile production advanced by 9% yoy as of September.

Overall, the production of durable consumer goods thrived (+12.9%), in contrast to the 4.9% decline in the production of non-durable consumer goods.

iulian@romania-insider.com

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