S&P Global Ratings will reassess Romania on October 2 amid the risk of a downgrade to junk status

S&P Global Ratings will assess Romania’s sovereign rating on October 2, amid a context marked by political deadlock, fiscal imbalances and the collapse of foreign investment. Romania currently holds a BBB-/A-3 rating with a negative outlook, the lowest level of investment grade.

A potential downgrade would send government bonds into the junk category, which could prompt major international funds to reassess their exposure to Romania. According to Alex Milcev, partner at EY Romania, rating agencies have given the country time to consolidate its finances—not a guarantee that its current rating will be maintained.

National Bank of Romania data show that foreign direct investment fell by 77% in the first seven months of 2026, to €1.127 billion, from €4.915 billion in the same period of 2025. At the same time, the current account deficit reached €16.290 billion, while net FDI inflows cover only 26% of this imbalance, according to Fitch estimates.

Fitch estimates that the budget deficit will fall to 5.9% of GDP in 2026, from 9.3% in 2024, but public debt is expected to rise to 64.5% of GDP by 2028. A downgrade could increase funding costs for the state, banks, companies and households, while also putting pressure on the leu. EY identifies improved tax collection, a credible 2027 budget and the restoration of political stability as priorities.