Bi-Weekly Report 5 December-19 December 2017


GDP growth is on track to reach a 4-year high of 6.8% this year, following its sharp rise to 11.1% y-o-y in Q3:17

The CBRT proceeded with a further 50 bp hike to its key monetary policy instrument



The current account deficit rose sharply to 3.3% of GDP on a 12-month rolling basis in October, from 2.1% at end-2016, reflecting sizeable fiscal policy stimulus

The European Commission calls for fiscal adjustment in Romania



Labour market conditions tightened further in Q3:17

Tourism activity remained strong in 9M:17, sustaining economic growth and the current account surplus



Credit growth (adjusted for FX movements) accelerated in 10Μ:17, reaching a 5-year high of 4.4% y-o-y in October

FX-adjusted customer deposit growth moderated slightly in October, to a still strong 7.5% y-o-y from a post-crisis peak of 10.5% at end-2016

The unemployment rate declined further to 13.1% in 9M:17



GDP growth returned to positive territory in Q3:17 (0.2% y-o-y), as the political situation normalises

Labour market conditions to tighten further in Q4:17 and FY:18



The current account deficit narrowed significantly on an annual basis in 9M:17, mainly on the back of a larger services surplus



Economic growth on track to reach a pre-crisis high in 2017 of 3.7%



External adjustment accelerated in Q1:17/18, mainly due to the positive effects from the  flotation of the EGP in early-November 2016, with the quarterly current account deficit narrowing by 0.9 pps y-o-y to (a 3-year low of) 0.7% of GDP


Appendix: Financial Markets

Bi-Weekly Report 5 December-19 December 2017