Fitch Ratings Affirms Romania’s Sovereign Rating at ‘BBB-‘, Stable Outlook

Fitch Ratings has reaffirmed Romania’s sovereign credit rating at ‘BBB—’ with a stable outlook, reflecting the country’s economic resilience and sound fiscal policies. This rating is significant for Romania as it influences investor confidence and borrowing costs, positioning the country favourably in the international financial market.

The reaffirmation of Romania’s credit rating comes as the country navigates various economic challenges, including inflation and the impacts of global economic fluctuations. The Ministry of Finance noted that Romania’s membership in the European Union and the associated capital flows have bolstered its economic stability and convergence. Additionally, positive trends in GDP per capita and governance indicators have positioned Romania favourably compared to other countries with similar ratings.

Minister of Finance Marcel Boloș emphasized that the government’s proactive measures to address socio-economic challenges have been crucial in maintaining this rating. He stated that the government will continue implementing fiscal consolidation measures to ensure sustainable economic growth. The Ministry highlighted the importance of maintaining a lower public debt level than other nations with the same credit rating, a well-capitalized banking sector, and declining inflation rates.

Fitch’s outlook suggests that Romania’s economy is expected to grow by approximately 3% in 2024 and 2025, driven by significant European funding from the Multiannual Financial Framework 2021-2027 and the Recovery and Resilience Mechanism. The agency pointed out that sustained efforts to reduce the budget deficit and improve the current account position could lead to an upgrade in Romania’s credit rating in the future. Conversely, risks to the rating include potential fiscal consolidation failures, which could result in a higher public debt-to-GDP ratio and undermine the credibility of public policies. Maintaining macroeconomic stability is essential to avoid adverse impacts on Romania’s creditworthiness.

Fitch’s reaffirmation of Romania’s sovereign credit rating positively indicates the country’s economic health and governance. By implementing effective fiscal policies and leveraging European support, Romania aims to enhance its economic resilience and attract further investment, ensuring sustainable growth in the coming years.