Romania’s industrial output (volume, chart) plunged 11.2% y/y in May in sharp contrast to the 12.1% y/y advance marked in April, according to the data published by the statistics office. 

In the combined period April-May, which avoids the effects of the Orthodox Easter dates (May this year compared to April in 2023), contracted by 0.4% y/y, the industrial output edged down by only 0.4% y/y compared to the steeper 2.7% y/y contraction in Q1.

The improvement was more visible in the core manufacturing industries, where the industrial output increased by 1.4% y/y in April-May compared to a 2.7% y/y decline in Q1.

A similar 1.4% y/y advance was seen in the mining sector for April-May.

The advance in the manufacturing and mining industries was dragged down by the 13.4% y/y contraction in the utilities sector.

The improvement in the core manufacturing industries (and in the overall industry to a lesser extent) is in line with the seasonally-adjusted PMI index that edged up to 52 points in May from 51.5 points in April remaining above the 50-point neutral benchmark for the second month in a row, showing clear signs of recovery in the Romanian manufacturing sector after three months of below-neutral readings in January-March (and most of the year 2023).

The improvement in the industrial sector in April-May was driven by the sectors of manufacturing of other transport means (automobile excluded, +20.6% y/y), chemical industry (+18.6% y/y), food manufacturing (+11.4% y/y) and tobacco processing )+14.1% y/y). All these sectors except for tobacco processing posted positive, but lower annual advance rates in Q1. 

In contrast, the light industries but also crude oil processing (-12% y/y) and motor transport means manufacturing (-5% y/y) posted negative growth rates in April-May (as well as in Q1). These industries posted negative growth rates in Q1 as well.