Bulgarian Central Bank: Eurozone Entry to Drive Banking Shifts and Inflation Trends in 2025–2027
The Bulgarian National Bank (BNB) projects that Bulgaria’s real GDP will continue expanding steadily over the coming years
The international rating agency + Standard & Poor's (S & P) confirmed Bulgaria's long-term and short-term credit rating in foreign and local currency 'BBB- / A-3'.
According to S & P's aggregate assessment, the country's fiscal and external positions remain strong and economic growth expectations are seen as favorable, despite the long-term structural constraints. The positive outlook for the rating reflects the significant likelihood that Bulgaria will join the Currency Mechanism II (MP II) over the next 12 months.
The rating agency expects GDP to rise steadily at 3.3% in 2019, then slow down to 3% in 2022. Private consumption and government investment will have a major impact. Export growth is expected to recover, despite weaker external demand in 2019 due to slower economic activity in major European trading partners.
According to S & P, the progress of the Action Plan for Accession to ERM II is estimated to be significant, with most of the commitments being undertaken or being implemented.
The Agency would raise Bulgaria's credit rating when entering ERM II. Further progress in structural and institutional reforms would also increase the country's creditworthiness, notes the analysis.
S & P may reconsider the outlook to a stable one if pressure on the balance of payments or the financial sector, for example due to the accumulation of macroeconomic imbalances. The outlook may be revised to a stable one, and if progress on the path to euro area membership has been slowing over a long period.
The Bulgarian National Bank (BNB) projects that Bulgaria’s real GDP will continue expanding steadily over the coming years
Two leading global credit rating agencies, Fitch Ratings and S&P Global Ratings, have raised Bulgaria’s long-term foreign currency credit rating to ‘BBB+’ with a stable outlook, marking the highest level in the medium investment-grade tier
The adoption of the euro inevitably brings a degree of unease and uncertainty, much like the introduction of the currency board in the 1990s
Loan interest rates in Bulgaria are expected to stay stable even after the transition to the euro
The Ministry of Finance has introduced an online currency conversion calculator, now available on the official euro adoption website for Bulgaria - evroto.bg
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