S&P affirmed Romania’s BBB-/A-3 investment-grade ratings but kept a negative outlook; HotNews says the prolonged government-formation process adds risks to budgets, the currency and investment.
On October 2, S&P Global Ratings affirmed Romania’s long-term BBB- and short-term A-3 ratings, the lowest rung of investment grade, while maintaining a negative outlook. The country avoided a downgrade into speculative territory, but the agency warned of risks. Romania’s Agerpres news agency also reported the decision and said S&P sees a risk that political deadlock could hinder fiscal consolidation in 2027 and 2028.
HotNews reports that Romania lacked a full-powers government after President Nicușor Dan made several prime-ministerial nominations. Citing Reuters, the outlet said yields on Romanian 10-year bonds had risen by about 60–80 basis points in two weeks, reaching their highest level in a year. Higher yields make new borrowing and debt servicing more expensive.
Political instability is not the only factor behind a weaker leu or higher rates: inflation, the external balance, interest rates, capital flows and central-bank policy also affect the currency. But uncertainty may make investors more cautious, while a weaker currency raises import costs and can feed into prices.
The outlet also cites National Bank of Romania figures showing foreign-exchange reserves fell by about €4.8 billion in September, from €64.87 billion to €60.06 billion. About €2.7 billion of the outflow was attributed in the report to public-debt payments. The entire decline therefore cannot be attributed to the political crisis.
HotNews argues that the larger risk is delayed decisions on the budget and deficit reduction. A prolonged transition could postpone government measures and investment. S&P said a derailment of fiscal adjustment could prompt a downgrade; a credible medium-term policy plan and reductions in fiscal and external deficits could support a return to a stable outlook.