Brussels – Bulgaria has officially reached the necessary benchmarks to adopt the euro as its currency, with plans to introduce the single currency on January 1, 2026. This follows the most recent enlargement of the eurozone, which included Croatia in 2023. According to the European Commission, Sofia has met all required parameters, paving the way for the country to transition from the Bulgarian Lev to the euro.

The decision now rests with the EU Council, which will vote to provide the necessary qualified majority for proceeding with the adoption.

In order to qualify for euro adoption, Bulgaria has had to meet four essential macroeconomic criteria, the first of which is price stability, measured by the inflation rate.

Bulgaria’s inflation level is reported at a relatively low 2.8 percent, stabilizing further with projected reductions in budget deficits.

The government deficit, as a ratio of GDP, is estimated to rise from 2 percent in 2023 to 3 percent in 2024, but is expected to decrease to 2.8 percent by 2025 and 2026, aligning with the EU's requirements for budgetary stability.

Additionally, Bulgaria has demonstrated successful engagement in the European Exchange Rate Mechanism (ERM II) for nearly five years without significant fluctuations, thereby showcasing its exchange rate stability.

The country’s long-term interest rate has remained stable since April 2023, currently resting around 4 percent.

The European Commission has expressed confidence in Bulgaria's ability to function effectively within the euro area, citing a solid external economic position and a high degree of integration within the eurozone’s products, services, and financial markets.

Its economic cycles are well-aligned with those of the euro area.

Bulgaria's participation in the Banking Union since 2020 has further established ties, with the European Central Bank supervising five major commercial banks that collectively manage approximately three-quarters of the national banking sector's assets.

Valdis Dombrovskis, the European Commissioner for the Economy, has acknowledged Bulgaria’s adherence to all convergence criteria and anticipated its entry as the eurozone’s 21st member, while also emphasizing the importance of ongoing reforms to bolster the country's economic competitiveness and resilience.

Preparations for the euro transition are currently underway, with the European Commission set to make formal recommendations to the EU Council.

Following meetings scheduled for June 19, recommendations by the Eurogroup could lead to a political agreement within the Ecofin Council the next day.

A qualified majority vote is necessary to grant Bulgaria the permission to adopt the euro, with a leaders’ summit slated for June 26-27 expected to grant political support, allowing for the formal adoption of their accession regulation and exchange rate.

Should Bulgaria successfully adopt the euro, it will join 21 of the 27 EU Member States that currently utilize the single currency.

Denmark remains exempt from this obligation due to prior negotiations, while Sweden is bound by a 2003 referendum decision that rejected euro adoption.