Moody’s: Romanian economy to start growing in H2 of 2010

Romania’s economy will start growing in H2 of 2010, said Kenneth Orchard, analyst with Moody’s rating agency, which revised downward its forecast in the Romanian economic decline to 8.9% this year from a 5.7% contraction predicted in July. from -5.7% to -8.9% the forecast regarding the GDP decrease in 2009.

„The import data is showing a rather dramatic decline in domestic demand. We assume that this trend will continue through the remainder of this year and into early 2010. The economy would then start to grow around the second half of 2010,” Kenneth Orchard said, quoted by the daily paper Ziarul Financiar.

However, Orchad stated that Romania might contradict the gloomy predictions for this year, especially if the top European economies manage ‘a robust recovery’ in the second half, Moody’s analyst said.

„The local part of economy will continue to have no results for at least several quarters as it is confronted with the late effects of the economic boom years.

The domestic recovery will also depend on the governments actions over the next 1-2 years, plus the evolution of the health of the European banking system,’ Orchard said.

Moody’s is the only important rating agency that proves ratings and investment recommendations to Romania, after Fitch and Standard & Poor’s downgraded Romania last autumn to a speculative level (junk).

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