Boston, MA -- (SBWIRE) -- 10/10/2014 -- Core Views:

- Romania's economic recovery will outperform most regional peers and move onto a firmer footing over the coming quarters, with household consumption set to compensate for net exports' lower contribution to growth.

- While recovering imports and outgoing profit repatriation will widen the current account deficit, this will not pose a threat to the country's ongoing recovery.

- The National Bank of Romania (NBR) is likely to cut the policy rate to at least 3.00% by year-end, in an attempt to boost inflation and stave of excessive leu strength.

- Romania's government are likely to ease up on the pace of fiscal austerity in 2014 and 2015, but will remain within EU budget and public debt targets.

- We expect Prime Minister Victor Ponta to win the November Presidential elections. This would be good for political stability, as the ruling PSD-led coalition would control both parliament and the presidency.

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Major Forecast Changes:

- We have revised-down our forecasts for the policy rate to 3.00% by end-2014, from 3.25% previously due to lower than expected food price inflation.

Key Risks To Outlook:

- The main risk to our outlook is for a more significant softening of external demand from core eurozone economies. This would impair exports and be bad for the country's large manufacturing sector. We would look to downgrade our real GDP forecasts for Romania in 2014 and 2015 in such a scenario.
- Anything other than a Victor Ponta victory in November's presidential elections would be bad for political stability over the short-term. The other main candidate is opposition coalition hopeful Claus Iohannis. An opposition victory would increase fears of more feuds between the office of the president and prime minister, and would make it more difficult for the government to push through economic reforms.

...

The Romania Business Forecast Report helps businesses with market assessment, strategic planning and decision making to promote growth and profitability in Romania and is an essential tool for CEOs, Chairmen, Finance Directors/CFOs, Managing Directors, Marketing/Sales Directors with commercial interests in this emerging market.

An influential new analysis of Romania's economic, political and financial prospects through end-2018, just published by award-winning forecasters, Business Monitor International (BMI).

Key Uses

- Forecast the pace and stability of Romania's economic and industry growth through end-2018.

- Identify and evaluate adverse political and economic trends, to facilitate risk mitigation.

- Assess the critical shortcomings of the business environment that pose hidden barriers and costs to corporate profitability.

- Contextualise Romania's country risks against regional peers using BMI's country comparative Risk Rankings system.

- Evaluate external threats to doing business in Romania, including currency volatility, the commodity price boom and protectionist policies.

The Romania Business Forecast Report by Business Monitor International (BMI) includes four major sections: Economic Outlook, Political Outlook, Business Environment and Key Sector Outlook.

Economic Outlook:

How will the Romania economic policy-making and performance impact on corporate profitability over 2014-2018?

BMI provides our fully independent 5-year forecasts for Romania through end-2018 for more than 50 economic and key industry indicators. We evaluate growth, and also forecast the impact of economic management.

Economic Outlook Contents

The Romania Business Forecast Report features BMI's forecasts with supporting analysis for 2014 through to end-2018, set against government views and BMI's evaluation of global and regional prospects.

Key Areas Covered:

Data:

- Full 10-year forecasts with data - for key macroeconomic variables including GDP (real growth and per capita), population, inflation, current account balance and the exchange rate.

- BMI's comprehensive Risk Rankings system - rates each country worldwide for economic and political risk, and rates the business environment, within a global and regional context.

Written Analysis:

- Economic Activity - real GDP growth, employment, inflation, consumption (retail sales and confidence).

- Balance of Payments - trade and investment, current and capital account.

- Monetary Policy - interest rate trends (bank lending and deposit rates) and inflation (producer price and consumer price).

- Exchange Rate Policy - currency controls, foreign investment flows, exchange rates and foreign exchange reserves.

- Fiscal Policy - macroeconomic strategy and policies, government finance and tax reforms.
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