In the opening month of 2024, Romania’s Economic Sentiment Indicator (ESI) showed marginal stability, inching down slightly to 102.3 compared to December’s reading of 102.4, according to a recent report from Erste Group. The nuanced shifts in sentiment were reflected across various sectors, offering a diverse outlook for the nation’s economic landscape. Employment Expectations Ease, GDP Eyes a Rebound The Employment Expectations Indicator (EEI) witnessed a dip to 103.3 in January from December’s 106.1. This aligns with actual employment data indicating a plateau in workforce expansion since last autumn. Despite this, Erste Group projects a rebound in GDP growth, forecasting a rise to 3.3% in 2024 from the 2.1% recorded in 2023. Key drivers for this anticipated growth include robust real wage increases, favorable labor market conditions, and positive spillover effects from past state investments. Sectoral Insights: Manufacturing, Services, Retail, and Construction In the manufacturing sector, confidence saw a decline to -0.5 in January compared to December’s -0.3. This downturn was attributed to shrinking production expectations, possibly influenced by weakened domestic demand. Nevertheless, a silver lining emerged with an improvement in export order books in January. The sector’s capacity utilization surged to 71.3%, reflecting a notable increase from October’s 66.5%. Erste Group maintains a cautious optimism, expecting a modest recovery in manufacturing throughout 2024 after facing challenges in the preceding years. Services confidence took a hit, dropping to 4.4 in January from December’s 5.4. The decrease was linked to lower consumer demand in the past and anticipated challenges in the next three months. On a brighter note, retail trade confidence exhibited improvement, climbing to 11.1 in January from 8.8 in December. Both backward-looking and forward-looking components contributed to this positive shift, indicating a potential boost in consumer activity in the coming months. Construction sentiment, however, saw a decline, registering -6.6 in January compared to December’s -6.4. This dip raises questions about the sector’s short-term outlook. Inflationary Pressures Across Sectors An overarching trend across all sectors surveyed is the rise in selling-price expectations. This suggests growing inflationary pressures, impacting manufacturing, services, retail, and construction. In conclusion, as Romania navigates the complexities of economic sentiment, Erste Group’s report hints at both challenges and opportunities. While some sectors face headwinds, there is an overall expectation of a measured recovery in 2024, guided by various economic factors and cautious optimism. As the year unfolds, stakeholders will keenly observe how these dynamics shape Romania’s economic trajectory.
The Atlantic Council will honor Romanian president Klaus Iohannis with the Distinguished International Leadership Award for his remarkable career, exemplary leadership of Romania, and his transatlantic and European leadership role. The Atlantic Council’s Distinguished Leadership Awards are often referred to by media as “the Washington Oscars.” Among the honorees are a European head of state, […]
The colorful rapeseed fields in the southern part of Romania have been photographed by NASA from a satellite and featured in an accompanying article titled “Golden Fields in Romania.” The spectacular images were taken last month above the area where the Olt River intersects with the Danube. According to the article, NASA personnel were impressed […]
UiPath, an AI-based company founded by Romanian entrepreneurs and listed on the New York Stock Exchange in 2021, has recruited Raghu Malpani as Chief Technology Officer. Malpani, who was Corporate Vice President at Microsoft for the Microsoft 365 Application and Data Platform will report to the Director of Innovation and the Executive President of UiPath, […]
Production and new orders rise after nine straight months of decline Business confidence picks up, while hiring is back on the agenda Cost inflation eases and selling prices rise only fractionally An improvement in the health of the Romanian manufacturing sector was signalled for the first time in the survey's history, according to the latest […]
Raiffeisen Bank Romania continues its growth strategy in personal financial planning, up 50% in the first quarter of the year in the segment of investment plans, voluntary pensions and life insurance with a savings component. At the same time, it continued to support SMEs and accelerated investments to launch new functionalities in the mobile banking […]
Road crews have begun snow removal on Romania’s spectacular mountain road known as Transfăgărășan. Since there is less snow than in other years, the road could be opened much earlier than the usual date of July 1, according to authorities. Transfăgărășan, Romania’s second-highest road after Transalpina, is being cleared of snow so it can be […]
