Erste Group analysts estimate economic growth of 1.1pct for Romania in 2013
Analysts of Erste Group anticipates, for 2013, an increase of 1.1 percent of Romania's GDP, as the renegotiation of an International Monetary Fund agreement and the pressing ahead with the better absorption of EU subsidies will be credit-positive.
In the latest report on 'Central and Eastern Europe markets and stocks' of Erste Group, published on Monday, analysts noted that the macro-economic decline will reach its peak in the first quarter of 2013, estimating an economic growth of 1.1 percent for Romania, of 2.2 percent for Poland, 1.3 percent – Slovakia and an economic decline of 0.1 percent for the Czech Republic, due to uncertainty in the euro zone, but also following internal austerity policies and exports as the only source of growth.
According to analysts, the CEE markets will be driven by two major themes in 2013. On the one hand, an economic slowdown and even recession are increasingly tangible, although the downturn is likely to bottom out in Q1 2013. What is more, the Eurozone crisis is seen as not massively escalate. Based on these two assumptions, coupled with the strong reliance on central banks, equity markets have benefited from an overall decrease in risk aversion. The abundance of liquidity and the search for meaningful yields have contributed as well.
Referring to CEE Equity, a slow start is expected in January, stronger upside to kick in later in Q 1.
We are actually pleased that Romania BVB did so well, while our main reservation was liquidity, Henning Esskuchen said.
Economic sentiment is improving toward Romania, Erste report notes, showing that, according to the latest ZEW / Erste Sentiment Indicator for CEE, within the next six months, it have slightly worsened.
ZEW-Erste Economic Sentiment Indicator for Central and Eastern Europe, including Turkey (CEE), is calculated as the balance between positive expectations and negative ones on the evolution of the economy in a six-month horizon.
Clearly, the most powerful of our proposal is the change from Turkey to Russia. Romania and South-East Europe (ie Serbia) could benefit from their status of frontier markets, assuming that the general perception of the risk stays positive, Henning Esskuchen underlined.
Erste Group is the leading financial services provider in Central and Eastern Europe. The approximately 50,000 employees serve 17 million clients in 3,100 branches, in eight countries (Austria, Czech Republic, Slovakia, Romania, Hungary, Croatia, Serbia, Ukraine). On September 30, 2012, total assets held by Erste Group were worth 217 billion euros, with an operational profit of 2.619 billion euros and a cost-income ratio of 51.9 percent.