The latest data revealing widening twin deficits in Romania, published at the end of last week, prompted concerns and pushed up the yield of the 10-year bonds to 6.89% from 6.75% before, putting pressure on the public debt service, warned Adrian Codirlasu, deputy president of the CFA Romania Society.

This is severely hindering the government’s capacity to provide fiscal stimulus in the coming quarters, when such a policy is needed more, he explained, as quoted by Economica.net.

The interest on public debt rose by 17% in the first seven months of 2024 to 1.2% of GDP (still at the same level as in January-July 2023), and Codirlasu expects these costs could increase to 2.5% or even 3% of GDP by the end of the year from 1.9% in 2023.

iulian@romania-insider.com

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