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Country Risk Service Romania

  • ID: 2131072
  • Country Profile
  • April 2020
  • Region: Romania
  • 28 Pages
  • The Economist Intelligence Unit
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The sovereign risk score has deteriorated by 7 points to 47 compared with The Economist Intelligence Unit's November 2019 ratings report. The rating remains unchanged, at BB. The deterioration in the risk score reflects a worsened macroeconomic and fiscal environment owing to the coronavirus crisis. The rating is also driven by a volatile political environment and the government's typically pro-cyclical fiscal stance.

The currency risk score has deteriorated by 6 points to 44 and the rating has been downgraded to BB from BBB previously. The deterioration in the fiscal environment has affected the currency risk score, but the increase is mostly driven by the coming recession and its negative financial repercussions.

Romania's banking sector score has deteriorated by 4 points, from 43 to 47, but the rating is unchanged, at BB. The deterioration is primarily driven by our expectation that financial intremediation will suffer in 2020 owing to the economic recession and by the decline in the price of financial assets in the first few months of 2020. Banks are generally well capitalised and liquid, and have reassuring provisioning buffers in the face of pressures on asset quality.
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Country Risk Service Romania

Risk assessment
Sovereign risk
Currency risk
Banking sector risk
Political risk
Economic structure risk

Definitions
Sovereign risk
Currency risk
Banking sector risk
Political risk
Economic structure risk
Overall country risk

Sovereign risk
Current assessment
Positive factors
Negative factors
Rating outlook

Currency risk
Current assessment
Positive factors
Negative factors
Rating outlook
Foreign-exchange regime

Banking sector risk
Current assessment
Positive factors
Negative factors
Rating outlook

Generic risks
Political risk assessment
Economic structure risk assessment

Country risk
Overall country risk

Central scenario for 2020-24: Political stability

Central scenario for 2020-24: Election watch

Central scenario for 2020-24: International relations

Central scenario for 2020-24: Policy trends

Central scenario for 2020-24: Fiscal policy

Central scenario for 2020-24: Monetary policy

Central scenario for 2020-24: Economic growth

Central scenario for 2020-24: Inflation

Central scenario for 2020-24: Exchange rates

Central scenario for 2020-24: External sector

Central scenario for 2020-24: External financing requirement

Central scenario for 2020-24: External debt

Key risk indicators

Ratings summary

Quarterly indicators

International assumptions summary

Economic structure

Public finances

Exchange rates, interest rates and prices

Financial sector

Current account

International liquidity

Foreign payment and liquidity indicators

External trade

External financing requirement

External debt stock

External debt service
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