From Yahoo Finance: 2025-06-02 06:00:00

Bulgaria’s potential adoption of the common currency could accelerate growth by 2.75% annually, bringing it closer to EU living standards. The country formally requested assessment from the EC and ECB, a crucial step to joining the Economic and Monetary Union, amidst domestic political divisions.

Scope Ratings anticipates approval of Bulgaria’s accession to the euro by the ECOFIN Council on July 8. Positive feedback from European institutions signals potential entry, expanding the euro area to 21 member states.

Efforts to control inflation have been pivotal for Bulgaria’s euro adoption bid. Recent data shows a decrease in inflation rates, meeting the convergence criteria. The country forecasts a decrease in consumer-price inflation from 3.4% to 1.6% next year.

Domestic political fragmentation poses a risk to Bulgaria’s euro adoption. Divisions within the government have led to delays in required reforms. The pro-Russian opposition group has called for a referendum, supported by President Rumen Radev, though parliament has rejected the proposal.

Concerns over Bulgaria’s fiscal position have arisen due to increased state spending. The country maintains a moderate budget deficit and low public debt, with plans for steady increases in government debt by 2030.

The EC’s positive assessment of Bulgaria’s fiscal plan for 2025-2028 is a promising sign for euro adoption. Fiscal metrics remain sound, with deficits stable and debt increasing gradually. The country’s public finances are deemed stable and sustainable, supporting its path towards euro adoption.

Read more: Bulgaria on Track to Adopt the Euro, Supporting the Economic Outlook