Bulgaria has received the long-anticipated green light from European institutions to adopt the euro, with a convergence report published by the European Central Bank confirming that the country meets the necessary criteria. The ECB highlights Bulgaria’s progress in aligning its economy with the eurozone, marking a significant step toward becoming the 21st EU country to join the single currency on January 1, 2026. “This favorable assessment reflects Bulgaria’s strong commitment to the required reforms,” ECB Executive Board member Philip R. Lane stated.

Read the 2025 convergence report here.

The reports, issued by both the European Commission and the ECB, will be reviewed by Eurogroup finance ministers and ECOFIN during upcoming meetings in Luxembourg. A final decision is expected to come from EU leaders at the European Council by the end of June. If all steps are completed, the official decision could be taken on July 8, requiring a qualified majority vote for approval.

In terms of macroeconomic indicators, Bulgaria meets all convergence criteria. Inflation in April 2025 stood at 2.7% - below the 2.8% reference threshold calculated from the average inflation rates of Ireland, Finland, and Italy, with a 1.5-point buffer. On fiscal performance, Bulgaria’s 2024 budget deficit was exactly 3.0% of GDP, within the required limit. Public debt remains one of the lowest in the EU - 24.1% of GDP, well below the 60% benchmark.

The national currency, the lev, has been stable within the Exchange Rate Mechanism II between May 2023 and May 2025, maintaining a fixed rate of 1.95583 leva per euro. Bulgaria has also implemented most of its ERM II commitments, though work remains in areas like anti-money laundering and counter-terrorism financing. Interest rates averaged 3.9%—again, safely under the 5.1% ceiling set by the ECB.

From a legal standpoint, Bulgarian legislation is in line with EU treaties and the statute of the European System of Central Banks, fulfilling the final legal requirement under Article 131 of the EU Treaty.

Concerns that inflation might immediately rise after the reports were made public were dismissed by economic observers, who pointed out that such trends have not been observed in similar cases. Analysts say if there is a price increase, it likely won’t be a result of the convergence assessment alone.

The idea of holding a national referendum on euro adoption has been rejected by EU experts, who emphasize that Bulgaria already committed to joining the euro when it acceded to the EU. Such a vote would conflict with existing EU obligations.

Bulgaria’s road to the euro has been long and methodical. The first step came in 1997, with the introduction of a currency board that pegged the lev to the German mark, and later to the euro in 1999. The fixed exchange rate has remained unchanged since.

The country formally entered ERM II and the Banking Union in July 2020, positioning itself in the eurozone “waiting room.” The same year, it began participating in the EU’s banking supervision and resolution mechanisms to strengthen financial stability.

In June 2021, the Bulgarian government adopted the National Plan for Euro Adoption, laying out the logistics of the transition, including a one-month period during which both currencies will be in circulation.

Subsequent legislative updates followed in 2024, most notably the Euro Adoption Act and amendments to the BNB Act, which defined the fixed rate, introduced dual price displays, and outlined protections for consumers.

Although the initial plan was to adopt the euro earlier, the 2024 convergence report found that inflation was still a concern, prompting a delay. In early 2025, Bulgaria submitted a formal request for a new assessment, which led to today’s favorable outcome.

The path to euro adoption is detailed and demanding, but Bulgaria has now positioned itself as ready - pending final political approval from EU leaders next month.