The Manufacturing PMI in Romania (chart) inched up in February to 48.3 from the record low of 46.1 in January, remaining significantly below the 50 neutral mark for the eighth consecutive month, according to BCR Romania.

Romania’s industrial output has contracted gradually over the past three years and it marked a 1.6% year-on-year average decline in 2024. Under the latest projection drafted in December, the state forecasting body CNP indicated expectations for modest 0.4% y/y industrial expansion this year followed by stronger rates of above 2% per annum in the coming years. The PMI readings in the first two months of the year are not yet encouraging in this regard.

However, some signs of improvements are visible: all components except suppliers’ delivery times (the only component in the “positive” area, or above 50-point mark) have improved in February compared to January.

Manufacturing is certainly affected by the volatile global landscape and the local political and economic backdrop, but February might be an early sign of a bottoming out, the BCR Romania analysts commented. However, both the data collected from managers and the analysts’ comments precede the US President Trump announcing high trade tariffs – which greatly increased volatility.

Despite remaining in contraction territory, the HCOB Flash Germany Manufacturing PMI also showed an improvement in February and reached a 24-month high, BCR Romania argues in favour of possible improvement in Romania’s industrial sector.