This improvement is expected to be primarily driven by a projected peak in EU fund absorption from the Recovery and Resilience Facility (RRF) and an improving trade balance, despite ongoing concerns regarding weak external demand.

The fiscal landscape remains a core focus of the report, with the budget deficit estimated to have narrowed from 9.3% of GDP to 8% in 2025, with a further decrease to 6.2% anticipated for 2026. This consolidation follows a challenging 2025, where a 5% decline in real wages and a VAT increase pushed annual inflation to a peak of 9.7%—the highest in the European Union.

Consequently, the National Bank of Romania has maintained a restrictive policy rate to combat
persistent inflationary pressures.

While Romania's trajectory remains cautious, the broader EBRD regions are showing stronger momentum. Growth across these regions is estimated at 3.4% in 2025—outperforming previous expectations by 0.2 percentage points—and is forecast to rise to 3.6% in 2026 and 3.7% in 2027. For Romania, the outlook for 2027 is even more optimistic, with growth expected to hit 2.2%.