Financial Expert's Projections: If Inflation Continues to Fall Bulgaria Can Adopt the Euro in 2025

Business » FINANCE | May 16, 2024, Thursday // 12:03
Bulgaria: Financial Expert's Projections: If Inflation Continues to Fall Bulgaria Can Adopt the Euro in 2025 @Pixabay

Julian Voinov, an economist and financial expert, expressed optimism regarding Bulgaria's potential adoption of the euro in 2025 or early 2026, in an interview with BNR. He cited the recent decrease in inflation reported by the National Statistical Institute (NSI) as a positive sign, indicating progress towards meeting the criteria for Eurozone entry. Voinov highlighted the importance of sustaining this downward trend in inflation, asserting that Bulgaria is nearing compliance with the necessary criteria.

While acknowledging that Bulgaria may not fully meet the requirements for Eurozone entry by the time of the convergence report in June, Voinov suggested that an additional report requested later in the year could present a more favorable outcome. He emphasized the readiness of the Bulgarian National Bank and the banking sector for the transition to the euro, while noting the need for adjustments in information and accounting systems controlled by the government and municipalities.

Voinov echoed concerns raised by BNB Governor Dimitar Radev regarding the readiness of financial institutions and state bodies for the euro adoption process. He pointed out potential challenges, particularly in information dissemination and institutional preparedness, which could impact public confidence in the transition.

Regarding the implications of euro adoption on interest rates, Voinov explained that while external debts could see reduced interest rates, he cautioned against expectations of continued low rates in the mortgage lending market. He attributed current low mortgage rates in Bulgaria to the lack of alternative investment options, particularly in a robust real estate market.

Voinov underscored the importance of Bulgaria's commitment to Euro-Atlantic values for fostering stability and facilitating discussions with EU and NATO partners. He emphasized the need for a steadfast Euro-Atlantic government to uphold these values and ensure Bulgaria's continued integration into the Eurozone and broader Western alliances.

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Tags: inflation, euro, Eurozone, Bulgaria

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