Also, Romania's GDP growth is expected to be 2.6% in 2026, up from 3.8% in June forecast by the World Bank.

Growth in Central Europe is expected to recover to 2.8% in 2025 and 3% in 2026, thanks to robust private demand. Central Europe's export growth is expected to remain modest, following the euro area's subdued advance.

Investment, especially in Poland and Romania, is expected to improve on the back of structural reforms and delayed EU funds. These countries have had 19% and 33% of their Recovery and Resilience Facility allocations disbursed, respectively, with around 13% of targets met and positively assessed, the report says.

Despite the inflow of EU funding, recently announced fiscal consolidation measures have contributed to a significant downward revision of Romania's outlook since June, the World Bank says.