Romanian economy stagnates in Q2 2026 and shrinks 1.9% year on year, INS data show

Flat quarter after a contraction

The National Institute of Statistics (INS) published provisional GDP estimates for the second quarter of 2026 on Friday, 9 October, showing that the economy was unchanged compared with the first quarter. On the seasonally adjusted series, GDP was 529.7 billion lei in current prices for the quarter, while the gross series put it at 501.1 billion lei. Compared with the second quarter of 2025, GDP fell 1.9% on the seasonally adjusted series and 0.2% on the gross series, both measured in real terms. For the first half of 2026, GDP reached 1,035.7 billion lei on the seasonally adjusted series, 1.6% lower in real terms than in the first half of 2025. On the gross series the half-year decline was 0.6%, against 907.2 billion lei in current prices. The first quarter had already contracted 0.1% compared with the last quarter of 2025, and in August INS had estimated a first-half decline of 0.8%, a larger fall than the latest figure.

Consumption falls, investment cushions the drop

Household final consumption was 3.1% lower in the second quarter than a year earlier on the gross series, a drag of 1.9 percentage points on GDP. Gross fixed capital formation, which covers investment in construction, machinery and other assets, rose 19.9% and added 4.3 percentage points. Exports of goods and services grew 4% and imports 3%, so net exports stayed negative because Romania bought more from abroad than it sold. Construction grew 15.4% and contributed 1.2 percentage points, while agriculture, forestry and fishing advanced 6.1%. Industry contracted 3.9%, trade, transport, hotels and restaurants fell 4.3%, and real estate transactions dropped 8.3%, according to volume indices calculated on the gross series.

An economist calls it a prolonged technical recession

Economist Christian Năsulea told DigiEconomic that the seasonally adjusted data now show three consecutive quarters of decline followed by one quarter of stagnation.

We now have, on the adjusted data, three quarters of decline and one quarter of stagnation. In practice, we are dealing with what is called a prolonged technical recession, because there are not just two quarters of decline, there are three.

Năsulea said the second-quarter stagnation was slightly better than the earlier contractions, but that stagnation was neither good news nor terrible news. He also argued that the combination of stagnation and high inflation means the term stagflation applies very clearly to Romania at present. The lei figures are in current prices, while the percentages measure real change after removing the effect of prices.

Revisions to 2025 and 2024

INS also published semi-definitive figures for 2025, showing GDP of 1,929.9 billion lei in current prices and real growth of 0.8%, revised up from 0.7% in the provisional estimate. Nominal GDP for 2025 was about 13.5 billion lei higher than in the provisional version, or 0.7% more. In 2025 industry contributed 0.0 percentage points to growth, while the contribution of construction was revised from 0.5 to 0.7 percentage points. The definitive 2024 figures put real growth at 1.1%, up from 0.9% in the semi-definitive estimate, with GDP at 1,767.5 billion lei in current prices. Household consumption rose 5.1% in 2024 and added 3.1 percentage points, gross fixed capital formation fell 7.3%, and real estate transactions rose 24.8%. INS revised its 2018-2023 series to align with Eurostat requirements.