UniCredit sees Romanian economy out of the woods and up 1.7% in 2011

Romania has reached the bottom of the crisis, two years down the road, and the 2011 perspectives are positive, according to a recent UniCredit report, CEE Quarterly. The bank's analysts expect Romania's GDP to grow by 1.7 percent next year, after an expected 2.5 percent drop this year and a recorded drop of 7.1 percent in 2009. Public consumption is also expected to shrink by 2 percent, while the exchange rate is seen at an average of RON 4.3 per EUR, as well as at RON 3.02 per USD. “Fiscal performance and external financing, conditional on the IMF/EU stand-by-agreement, continues to be crucial for Romania’s sovereign credit outlook. Due to relatively weak external balances and ongoing fiscal-related risks, we believe the RON is not yet ready for a sustainable recovery, and hence we expect EUR/RON at 4.30 by year-end,” writes the UniCredit report. Read the entire report for the CEE here. CEE_Quarterly_ENG editor@romania-insider.com