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Structural Strengths and Weaknesses: Romania’s ‘BBB-’ rating is supported by EU membership and related capital inflows that support income convergence, external finances and macro stability. GDP per capita, governance and human development indicators are above ‘BBB’ category peers. These are balanced against large and persistent twin budget and current account deficits (CAD) relative to peers, high budget rigidities and a fairly high net external debtor position. Wide Budget Deficit: The 2023 budget deficit was 6.6% of GDP, up from 6.3% in 2022. Monthly outturns indicate further widening of the 2024 deficit, which we have revised up to 7.2% of GDP, but kept the 2025 deficit forecast practically unchanged at 6.5% of GDP. We expect meaningful fiscal consolidation over the medium term, helped by the re-introduction of EU fiscal rules, although there are significant downside risks, given current uncertainties around post-election fiscal plans, and the series of fiscal slippages has negatively affected policy credibility. Increasing Public Debt: ���������ֳ� forecasts general government debt/GDP to increase to 59% at end-2026, from 48.8% in 2023, but still in line with the ‘BBB’ current median of 58.3%. Strong nominal growth, due partly to higher inflation, helped contain the debt increase until 2023, but high deficit forecasts, combined with slower nominal growth, put debt/GDP on an upward path. The interest payment/revenue ratio is 6.4%, more favourable than the 7.5% peer median, despite the increasing debt.