Romania 2Q Revised GDP -1.1% QQ, -8.7% YY

In unadjusted data, GDP fell 8.7% on the year in the second quarter to RON109.9 billion, on substantial declines in constructions, agriculture and retail.

INS data are slightly revised from a 1.2% quarterly contraction and a 8.8% annual drop estimated three weeks ago.

The GDP quarterly fall was driven mainly by declines in constructions (-11% compared with the first quarter), retail (-4.4%) and financial activities (-4.1%).

The volume of product tax collected at state budget was also reduced, net taxes on product registering a fall of 3%.

However, the industry and services sectors reported a quarterly increase of 4.5% and 0.2%, respectively, INS data showed.

Final consumption was down 2.8% in the second quarter, largely due to a 3.5% decrease of household consumption expenses. However, the final individual and collective consumption in the public administration rose 1.4% and 4.4% compared with the first quarter, respectively.

Investments also rose in the second quarter, as gross fixed capital formation was up 4.9% compared with the previous quarter.

In the first half of 2009, Romania’s GDP posted a 7.6% drop on the year in real terms to RON206.4 billion.

The government has recently revised down its GDP forecast for 2009 to RON497.3 billion from previously seen RON531.2 billion, to reflect an economic contraction predicted at 8%-8.5% for the whole year.