Romania’s industry shrinks by 2.5% y/y in January amid fragile outlook improvement
<p><meta charset="UTF-8" /></p>

<p>Romania’s industrial production contracted by 2.5% y/y in January, with a slightly milder decline of 2.3% y/y in the core manufacturing industries, the statistics office INS announced.</p>

<p>However, there are positive signs: the workday-adjusted industrial output increased by 2.1% y/y (reflecting the smaller workday count in January 2025 compared to 2024)&nbsp;and&nbsp;the seasonally- and workday-adjusted industrial production index (+2.5% m/m) remained on a positive path consolidated during H2 last year.</p>

<p>The industrial output in the 12 months to January dropped by 1.4% y/y, further sweetening its negative performance from -1.6% y/y calculated for the 12 months to December.</p>

<p>Romania’s January industrial figures come as no surprise<strong>&nbsp;</strong>after the 1.6% decline in 2024 and 3.0% y/y contraction in 2023, while a negative outlook is supported by analysts’ expectations measured in recent surveys.&nbsp;</p>

<p>The Manufacturing PMI remained in February in the “negative” (under 50-point benchmark) for the eighth consecutive month&nbsp;and&nbsp;the expectations component of the CFA confidence index improved by only 1.7 points m/m at the end of January and remained at a very low level of 32.5 points deep in the “negative” outlook region.</p>

<p>However, analysts of Austrian group Erste have positive anticipations and see a return to growth for industrial production this year, forecasting a +1.1% increase. The positive expectations are pinpointed by rather recent developments in Europe: “significant investments in EU security along with large fiscal stimulus planned in Germany.”&nbsp;</p>

<p>“Domestic and external confidence indicators appear to be rebounding from record lows&nbsp;and&nbsp;new orders for manufacturing are gaining speed gradually,” according to Erste Research.&nbsp;</p>

<p>Indeed, HCOB Eurozone Manufacturing PMI rose to a two-year high at 47.6 in February as contractions in output and new orders eased.</p>

<p><strong>In Romania, the main industries saw diverging performances in the first month of 2025.</strong></p>

<p>In January, the output in road vehicle manufacturing plunged by 12% y/y, and textile and clothing manufacturing fell by 25% y/y and 21% y/y, respectively, while several other sectors saw milder contraction rates.</p>

<p>However, other industries started the year on the right foot: food manufacturing expanded by 3.8% y/y, and&nbsp;manufacturing of non-metallic mineral products (construction materials, such as cement, adhesives, or glass) surged by 11.2% y/y. Manufacturing of metal structures also saw an encouraging 5.0% y/y dynamics.</p>

<p><em>iulian@romania-insider.com</em></p>

<p><em>(Photo source: <a href="https://www.dreamstime.com" rel="noopener" target="_blank">Silviu Matei/Dreamstime.com</a>)</em></p>