Romania’s construction works volume index surged by 41% y/y in July, with the capital repairs segment soaring by 67% y/y and the other segments rising by 30%-40% y/y, according to data published by the statistics office INS. The seasonally and workday adjusted index rose by 20% m/m. In H1, the construction works index rose by 6.1% y/y, reversing the slowdown seen in 2024 (-2.8% y/y in H1 2024). Speeding up the registration of some of the contracts (where possible) before the VAT rate hike of August 1, particularly relevant for the residential units, where the VAT rate rise was more relevant, is a possible cause. In H1, the civil engineering works (just over a fifth of total construction works) boasted the highest growth rate (+11.0% y/y) while the residential segment posted a moderate 2.7% y/y advance and the non-residential segment contracted by 0.3% y/y.