Romania GDP Shrinks for 1st Time Since 2020

Romania’s economy contracted by 1.7% year-on-year in the first quarter of 2026, reversing a modest 0.2% expansion in the previous three-month period, according to preliminary estimates. The latest figure marked the country’s first annual economic contraction since the fourth quarter of 2020, highlighting a significant loss of momentum at the start of the year. On a seasonally adjusted quarterly basis, the country’s GDP fell by 0.2%, marking a second consecutive quarterly contraction, though the pace of decline eased from an upwardly revised 2% drop in the previous quarter.

The Romanian economy expanded by 0.2% year-on-year in the final quarter of 2025, matching second estimates and slowing from a 1.7% growth in the previous three-month period. While the latest figure marked the nineteenth consecutive quarter of economic expansion, it represented the weakest pace of growth in the sequence, due to sharp declines in government spending (-13.2%) and household consumption (-0.7%). Meanwhile, gross fixed capital formation increased (+8.2%) and net external demand contributed positively to the GDP, as exports rose (+4.4%) more than imports (2.1%). On the production side, output decreased mostly for professional, scientific and technical activities (-4.6%), financial intermediation and insurance (-1.8%), and wholesale and retail (-1.5%). On a seasonal adjusted quarterly basis, the economy contracted by 1.8% in the fourth quarter, deeper than the downwardly revised 0.1% fall in the preceding period.

Romania’s GDP grew 0.2% year-on-year in the fourth quarter of 2025, slightly above the initial estimate of 0.1% and slowing from 1.7% in the previous quarter, second estimates showed. Despite the marginally upward revision, it remained the weakest growth since the first quarter of 2021, driven by declines in government spending (-2.5%) and household consumption (-0.6%). Meanwhile, growth was seen in gross fixed capital formation (+7.9%) and net external demand, as exports rose 2.1% while imports increased at a slower pace of 0.7%. On the production side, declines were recorded in professional, scientific and technical activities (-4.9%) and financial intermediation and insurance (-1.8%), while growth was seen in information and communication (+7.7%), construction (+5.3%), real estate activities (+2.2%), and agriculture, forestry and fishing (+0.5%). On a seasonally adjusted quarterly basis, the economy contracted by 1.9%, following a revised 0.1% decline in the previous period.