Romania’s economy could grow by 0.2% in 2026, below the Central and Eastern Europe average, on the back of fiscal consolidation measures, and is set to accelerate to 2.3% in 2027, according to the quarterly macroeconomic report published by UniCredit.

“Central and Eastern Europe (CEE) is poised to remain one of the most resilient growth regions in Europe, supported by domestic demand, investments financed by European funds and the reduction of risks in the energy sector, even as governments continue fiscal consolidation efforts and manage inflationary pressures,” shows the quarterly Quarterly Update report prepared by The Investment Institute by UniCredit, presented at a press briefing, according to Agerpres.

According to a statement, most CEE economies will register GDP growth of around 2-3% in 2026, supported mainly by household consumption and better absorption of European funds.

“Romania and Slovakia will perform below the regional average in the short term, as fiscal consolidation measures will weigh on economic activity. For Romania, UniCredit estimates GDP growth of 0.2% in 2026, followed by a rebound to 2.3% in 2027,” the report added.

The reopening of the Strait of Hormuz has reduced one of the main downside risks to the region’s outlook, easing concerns about energy supply disruptions and inflationary risks, although the situation in the Middle East continues to generate uncertainty, the cited source notes.

At the same time, fiscal stimulus and rising defense spending in Germany are expected to support regional exports from 2027.

“Central and Eastern Europe continues to demonstrate remarkable resilience. Despite fiscal adjustments, geopolitical uncertainties and structural challenges in the manufacturing sector, domestic demand remains a strong driver of economic growth. The region is entering a phase where countries able to combine fiscal consolidation with investment and reforms to boost competitiveness will be best positioned to attract capital and sustain long-term growth. Looking ahead, better absorption of EU funds and improving external demand should support a broader acceleration of the region’s economies from 2027,” said Mauro Giorgio Marrano, Senior CEE Macroeconomist, UniCredit, quoted in the release.

While the overall picture remains positive, the report highlights significant differences across countries. Thus, Poland will remain one of the best-performing economies, with an estimated GDP growth of 3% in 2026 and 2027, supported by robust domestic demand.

At the same time, Bulgaria is expected to register a growth of 2.9% in 2026, while Serbia could register an advance of 2.9% in 2026 and 3.5% in 2027.

In Hungary, the economic recovery will be more gradual, with growth of 1.3% in 2026, followed by an acceleration to 2.5% in 2027, amid the return of investment.

The report shows that inflation remains one of the main challenges in the region.

“Base effects, tax increases and energy price shocks are contributing to higher inflation in several countries. However, the reduction in energy prices is expected to significantly improve the outlook. By the end of 2027, UniCredit estimates that inflation will return to the target ranges of the central banks of the non-euro area CEE economies,” the document also states.

As for Romania, starting from the middle of this year, inflation will register a large decrease, supported by the elimination of last year’s inflationary shocks. In addition, the diminishing effects of the energy price shock and the moderation of consumer demand will contribute to the further reduction of inflationary pressures in the second half of 2027, the cited source notes.

Monetary policies will reflect this perspective of a gradual reduction in inflation after the temporary effects of the energy shocks.

Thus, the Hungarian central bank is expected to continue cutting interest rates in 2026, while monetary authorities in Poland, Romania and Serbia may only start moderate cycles of monetary easing in the second half of 2027. In the Czech Republic, the central bank may reverse the interest rate hikes made in 2026 in 2027.

“The gradual improvement in the inflation outlook creates a more favorable environment for financial markets, currencies and investment decisions. Even if the pace of monetary easing will vary from one country to another, companies and investors should benefit from greater macroeconomic stability and reduced inflation in the medium term,” said Eszter Gargyan, CEE FX Strategist, UniCredit.