Capital Economics sees Romania’s economy severely slowed by fiscal consolidation

07 August 2026 Romania’s economy will contract by 0.5% this year and will recover modestly by only 1.5% in 2027, according to the forecast published by Capital Economics. The combined growth of some 1% over the two years is less than the consensus forecast envisaging a modest 01% advance this year followed by more robust 2.2% growth in 2027. "Romania's economy has been in recession since the second half of last year and is likely to stagnate for the rest of this year, as previous fiscal tightening measures and the decline in real household incomes continue to affect economic activity," Nicolas Crittenden, economist at the consulting firm, explains, cited by Curs de Guvernare. Crittenden points out that Romania's GDP has contracted in each of the last three quarters, and in the first quarte