Bi-Weekly Report 26 January – 8 February 2021
ROMANIA
The budget deficit hit a record-high of 9.8% of GDP in FY:20 (up 5.2 pps against the FY:19 outcome), highlighting the weak starting point from which Romania entered the COVID-19 crisis
The budget deficit is set to narrow modestly to a still high 7.2% of GDP in FY:21, suggesting the need for further serious fiscal consolidation
The NBR appears to have limited room for further easing in order to bolster the post COVID-19 recovery
BULGARIA
Headline inflation eased to a 4-year low of 0.1% y-o-y at end- 2020 from 3.8% at end-2019, due to weaker domestic demand and lower energy prices
Domestic headline inflation is set to rebound in the period ahead, outpacing that of the euro area
Credit expansion lost steam in 2020 (up 4.5% y-o-y at end-year against 7.4% at end-2019), amid high uncertainty and rising credit risk
The deposit base continued to expand at a solid pace during the pandemic (up 10.2% y-o-y at end-2020)
APPENDIX: MACROECONOMIC & FINANCIAL INDICATORS