Slovenia’s GDP expanded by 1.7% in Q3 2025, reflecting a strong domestic demand push driven primarily by construction-linked investment at a time when the broader European industrial cycle remains weak. Romania posted a more moderate 1.6% increase on the unadjusted series, with seasonally adjusted data showing a 1.4% rise, indicating a slower and more uneven momentum. With new data about Slovenian and Romanian Q3 GDP, we will take a look at them while awaiting our domestic Croatia Q3 GDP data.
Let’s start with Slovenia, our neighbors. In Q3, Slovenia’s GDP expanded by 1.7 % YoY in Q3 2025, lifting the January to September growth rate to 0.7 %, with the composition of growth revealing a very narrow but powerful domestic demand impulse anchored almost entirely in construction-driven investment. Private consumption rose by 1.0 %, supported by stronger household demand for durables at 2.6 % and services at 2.1 %, while non-durables fell by 1.2 %, and government consumption also added 1.2 % on the back of higher individual consumption. The key macro engine was gross capital formation, which surged by 12.2 % and contributed 2.4 p.p. to GDP, with gross fixed capital formation up 9.1 %, the strongest reading in fifteen quarters, fully driven by building and structure investment that jumped 20.4 %, including a striking 31.4 % expansion in non residential construction that added 2.2 p.p. to GDP, while residential construction contracted 7.2 %. Equipment and machinery investment fell 3.1 %, indicating the investment cycle is highly concentrated in construction rather than broad-based. External demand was a drag, as exports fell 1.1 %, with goods at minus 1.7 % and services barely positive at 0.1 %, while imports increased 0.7 %, consistent with a domestic demand-heavy quarter. These investments required substantial material inputs, and since Slovenia cannot source all building materials domestically, a significant share of this construction momentum spilled directly into higher imports, reinforcing the link between investment strength and the negative external contribution.
Slovenian GDP YoY growth rates (Q1 2015 – Q3 2025, %)
Source: SURS, InterCapital Research
Value added rose 2.0 %, led by a 14.2 % surge in construction, adding 0.8 p.p. and strong performance in professional, technical, and administrative services at 4.2 %, adding 0.4 p.p., whereas manufacturing and energy-related activities declined by 1.0 %, subtracting 0.2 p.p. Employment continued to deteriorate, falling 0.4 % YoY, driven by losses in manufacturing at minus 1.7 % and construction at minus 2.3 %, while public administration, education, health, and social work increased by 1.9 %.
Slovenia enters the second half of 2025 with a clear divergence between strong domestic momentum and persistent external fragility, as investment and household spending continue to recover while exports remain structurally constrained by the weak European industrial cycle. Looking ahead, the sustainability of growth hinges on whether the construction driven investment pulse can offset ongoing trade headwinds, especially as global tensions and US tariffs keep pressure on the country’s export reliant model.
Romania
Romania’s economy softened in Q3 2025, with GDP declining 0.2% QoQ on a seasonally adjusted basis, marking a mild sequential contraction after earlier quarters of expansion, although the YoY readings remain firmer at 1.4% for the seasonally adjusted series and 1.6% for the unadjusted series. For the period January to September, GDP increased 1.4% on the seasonally adjusted data and 0.8% on the unadjusted figures, indicating that the recovery is ongoing but losing pace.
Seasonally adjusted quarterly YoY GDP development (2010-2025, %)
Source: Romanian Institute of Statistics, InterCapital Research
The QoQ drop partly reflects routine statistical re-estimation, as incorporating Q3 data led to small adjustments across 2024 and 2025, yet the signal remains that short-term momentum cooled compared to the strong Q2 dynamic. The YoY figures still point to a domestic demand-driven expansion, but the weaker sequential print suggests that external headwinds, tighter financing conditions, and earlier inventory corrections are weighing on near-term activity. The economy is still expanding in annual terms, although the trajectory into Q4 hinges on domestic stabilisation amid a softer external backdrop.
Romania’s macro backdrop remains defined by a delicate balance between fiscal consolidation and slowing domestic demand, as the government tightens policy to rein in a widening deficit while inflation pressures persist following the removal of the electricity price cap. With wage growth and retail activity losing momentum and uncertainty weighing on households, the economy enters the second half of the year with softer internal dynamics and greater sensitivity to external shocks.
Slovenia’s strong domestic demand impulse and Romania’s softer short term dynamics both unfold against a Eurozone backdrop that remains positive but subdued, with the bloc expanding 0.2% QoQ and 1.4% YoY in Q3 2025. The concentration of Eurozone strength in Spain, France and the Netherlands, alongside stagnation in Germany and Italy, keeps regional momentum uneven and limits any material uplift for Central and Eastern Europe. As we await Croatia’s Q3 GDP data, the overarching macro picture remains one of resilience, but without enough acceleration in the Eurozone to materially change growth prospects across the region.