The industrial output in October increased by 1.3% y/y and by 0.4% m/m in seasonally adjusted terms, according to data published by Romania's statistics office INS.

The seasonally-adjusted industrial output has increased 2.2% over the past three months [August-October]. But this was only after a 4.2% m/m plunge in July.

There are two ways of reading Romania's October numbers: short-term recovery periods always follow relatively deeper plunges, and this is the case now. 

On a more optimistic note, one can argue that the industrial activity seems to have stabilised over the past six months – although at a significantly lower level compared to March-April. 

External demand remains the main driver for Romania's industrial growth, and the direction of the country's industrial output largely depends on further developments in the eurozone. As industrial production in both France and Germany took a tumble in October, casting a shadow over the eurozone's projected 0.1% volume growth, the odds are for a further industrial slowdown in Romania as well.

On the upside, the structure of the Romanian industry in terms of value added has improved in the first three quarters of 2024. The figures for the first three quarters of the year show a 2.2% contraction in volume terms but only a 0.4% y/y decline in value-added terms. This is still far from the 0.6% y/y advance projected by the government's forecasting body CNP. 

iulian@romania-insider.com

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