Bulgaria has made significant strides towards adopting the euro, according to a report from the European Central Bank (ECB) released today. The Convergence Report evaluates Bulgaria's progress towards joining the Economic and Monetary Union, highlighting its readiness for potential euro adoption on January 1, 2026.
"This positive assessment of convergence paves the way for Bulgaria to introduce the euro as of 1 January 2026 and become the 21st EU Member State to join the euro area," said Philip R. Lane, Member of the ECB Executive Board. "I wish to congratulate Bulgaria on its tremendous dedication to making the adjustments needed."
The ECB's evaluation shows that Bulgaria meets the reference values of convergence criteria and adheres to legal requirements. Since July 10, 2020, Bulgaria has been part of both the exchange rate mechanism (ERM II) and the banking union, marking another step towards European integration amid challenging economic conditions.
For sustainable convergence in Bulgaria, stability-oriented economic policies and extensive structural reforms are necessary. These strategies are further elaborated in the report.
In terms of price stability, April 2025 saw Bulgaria's 12-month average HICP inflation rate at 2.7%, slightly below the reference value of 2.8%. This reference is derived from averaging inflation rates from Ireland (1.2%), Finland (1.3%), and Italy (1.4%) over twelve months and adding 1.5 percentage points.
Regarding fiscal criteria, Bulgaria has not faced an excessive deficit procedure since 2012. The country's general government budget deficit was at 3.0% of GDP in 2024, aligning with the reference value. Its debt-to-GDP ratio was significantly lower than the reference value at 24.1%.
During a two-year period ending May 19, 2025, Bulgaria's lev remained stable within ERM II without deviating from its central rate against the euro. While most ERM II post-entry commitments have been fulfilled by Bulgaria, further work is needed in anti-money laundering and counter-terrorism financing areas.
Long-term interest rates averaged at 3.9% during May 2024 to April 2025, undercutting the interest rate convergence criterion's reference value of 5.1%. Bulgarian law aligns with EU Treaties and ESCB Statute requirements as per Article 131.
The report follows a request from Bulgaria; however, regular Convergence Reports by ECB occur biennially or upon specific country requests.
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