Erste lowers Romania 2018 economic growth forecast

Romania's economy will grow by a real 4.1% in 2018, on the back of revision of historical data by the national statistical office and a slowdown of growth in agriculture, Erste Group analysts said on Friday, lowering their forecast, seenews.com informs.

"A slowdown of economic growth in the first quarter of 2018, along with a significant revision of the historical time series of GDP carried out by the National Institute of Statistics prompted us to revise our full-year economic growth forecast to 4.1% in 2018 (from 4.7%)," Erste said in its latest macroeconomic outlook on Romania.

According to Erste, 2018 will bring normalization of economic growth after very strong expansion in the previous year, as the fiscal stimulus will wear off and agriculture is unlikely to repeat its exceptional performance for two years in a row.

"We continue to see investments as the key engine of economic growth in 2018, in the context of recent encouraging trends for gross fixed capital formation and a possible pickup in EU structural funds," Erste noted.

The inflation rate is seen staying above the Romanian central bank's target for the remainder of 2018, with the year-end figure expected at 3.7%.

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