Better-than-expected performance in reducing the budget deficit has led to improved confidence in the economy, while the reduced risk of tax increases has tempered inflation expectations, says CFA Romania Association President Adrian Codirlasu, as the Macroeconomic Confidence Indicator rose by 10.4 points in January.

'Better-than-expected performance in reducing the budget deficit led to a positive adjustment in confidence in the economy. At the same time, the risk of tax increases declined, which also resulted in lower inflation expectations,' the CFA Romania Association president showed.

According to a press release issued by the association and sent to AGERPRES on Thursday, the CFA Romania Association's Macroeconomic Confidence Indicator rose substantially by 10.4 points in January. The expectations component increased 10.0 points to 48.6, while the current conditions component rose by 11.3 points.

The anticipated inflation rate for the 12-month horizon, February 2027, decreased compared with the previous month's level and reached 5.85%, while 94% of participants expect inflation to fall over the next 12 months compared with its current level.

As regards the euro/leu exchange rate, around 83% of participants anticipate a depreciation of the leu over the next 12 months. The average forecast for the six-month horizon stands at 5.1471 lei to the euro, while for the 12-month horizon the average anticipated euro/leu exchange rate is 5.1982 lei to the euro.

Regarding developments in residential property prices in cities, 61% of participants expect prices to stagnate over the next 12 months. At the same time, 61% consider current prices to be overvalued, while 33% believe they are fairly valued.

According to CFA, the forecast state budget deficit for 2026 recorded an average expectation of 6.6% of GDP, down compared with the previous month's figure.

Economic growth expectations for 2026 stand at an average of 1.1%, up from the previous survey round.

Public debt calculated as GDP percentage is expected to rise to 63% over the next 12 months.

The survey has been conducted monthly by the CFA Romania Association for more than 14 years and is an indicator through which the organisation seeks to quantify financial analysts' expectations regarding Romania's economic activity over a one-year horizon.

The CFA Romania Association is the organisation of investment professionals in Romania holding the Chartered Financial Analyst designation, administered by CFA Institute, USA. The CFA Romania Association is one of more than 160 member societies of CFA Institute and aims to promote the interests of investment specialists and to uphold high standards of integrity and professional excellence.

At present, the CFA Romania Association has more than 250 members holding the Chartered Financial Analyst designation.

The CFA community also includes around 140 candidates at one of the examination levels. Professionals who are members of the CFA Romania Association work for regulatory institutions, supranational institutions, banking institutions, insurance companies, securities brokerage firms, asset management companies, pension funds, consultancy firms, the public sector, educational institutions and companies operating in various sectors of the economy. AGERPRES (RO - writing by: Mariana Nica; EN - writing by: Adina Panaitescu)