S&P keeps Romania’s sovereign rating in place

After Fitch and Moody’s, Standard & Poor’s also keeps Romania’s sovereign rating in the last tier of the investment-grade category.

Daniela Budu, 05.10.2026, 14:00

The US rating agency Standard & Poor’s has announced it is keeping Romania’s sovereign rating at BBB- with a negative outlook. This means the country is considered investment-grade but sits near the lower limit, facing risks associated with high budget deficits from previous years as well as political and fiscal developments.

The key problem cited by the international agency’s experts is political instability. They believe a continued deadlock and the absence of a government with full powers could jeopardize budget deficit reduction efforts and drive up government borrowing costs. At the same time, the agency identifies public spending discipline, budget revenue levels, and the absorption of EU funds as factors contributing to this outcome. It also highlights the high level of public investment, largely supported by EU funds, as a key driver of economic activity.

However, the decision to maintain the negative outlook indicates the agency continues to see risks regarding Romania’s fiscal trajectory. The agency views the coming period as crucial for forming a government backed by a parliamentary majority and for adopting a credible budget framework for the next two years.

President Nicușor Dan believes the S&P decision confirms Romania’s economic stability and its status as a reliable partner for investors, though he warns against complacency. The interim finance minister Alexandru Nazare says that fiscal consolidation measures must continue, adding that embracing budget discipline next year and exercising prudence in 2028 could pave the way for the rating outlook to return to stable. In turn, the former finance minister Adrian Câciu advocates for curbing waste, boosting revenue collection, and safeguarding investments, alongside measures to foster economic growth.

Meanwhile, the economic consultant Adrian Negrescu notes that the decision to keep the rating in place provides a window of opportunity to address imbalances. In his view, Romania needs a government and a coherent governing programme able to cut the deficit and public spending while also securing available European funds.

Analysts explain that a downgrade to non-investment grade status would have dealt a severe blow to the country, as major investment funds could have withdrawn their capital. This would have resulted in unemployment, rising prices, and wage cuts for many Romanians, they add.

S&P could restore a stable outlook if Romania succeeds in reducing its fiscal and external deficits. The agency identifies a credible medium-term policy plan and a revival of economic growth as key factors. Conversely, the rating could be downgraded if government formation and the implementation of fiscal measures are delayed, if investor confidence erodes, or if external pressures intensify. In July, Fitch kept Romania’s sovereign rating at BBB- with a negative outlook, and Moody’s subsequently reaffirmed the country’s sovereign rating. (AMP)