S&P affirms Romania’s rating
Standard&Poor’s warns however it may lower Romania’s credit ratings
Mihai Pelin, 18.05.2026, 14:00
The financial rating agency Standard&Poor’s has confirmed Romania’s long- and short-term credit ratings, but the outlook remains negative, placing the country one step away from the non-investment grade. The move was unplanned and comes outside the calendar announced at the beginning of the year, and was triggered by the dissolution of the coalition government led by the Liberal Ilie Bolojan, following a no-confidence vote in Parliament.
S&P thus confirms fiscal progress in 2026, including the narrowing of the budget deficit in Q1 and the effects of the consolidation measures adopted previously. EU funding is seen as a key element of stability, with estimated inflows of up to approximately EUR 15 billion in 2026, which can support investment and financing the economy.
On the other hand, the negative outlook reflects the agency’s view that implementation risks related to the consolidation of public finances and the reduction of the country’s foreign deficits will remain high in the next 6 to 12 months. S&P warns that it could lower Romania’s ratings if the government stalemate protracted or led to an inability to further reduce fiscal deficits in 2027. If the Romanian government fails to obtain the expected EU fund inflows in the coming period, economic growth prospects would be limited, which would complicate the fiscal consolidation process and amplify balance of payments risks, the agency says.
The agency could also consider revising Romania’s outlook to stable if the country’s external and fiscal deficits narrowed substantially, supported by a rebound in economic growth.
This could be achieved, however, only through broad fiscal consensus among key parties on supporting additional consolidation measures in 2026 and 2027, including the endorsement of a credible budget for 2027, despite the dissolution of the ruling coalition less than a year after it was formed.
At the same time, the Romanian authorities must carry on the implementation of the structural reforms required to attract EU funds and to strengthen budgetary discipline, including in sensitive areas such as public sector wages and public administration. S&P states that the Romanian economy could experience temporary stagnation in 2026, also influenced by developments in international energy markets.
S&P’s budget deficit estimate for this year is 6.25%, still very high compared to elsewhere in Europe. For 2027, a rebound to 2.5% is projected, against the backdrop of reforms and accelerated investments, which could lead to an improvement of macroeconomic indicators and to reduced external imbalances. (AMP)
