The shift to the euro in Bulgaria is proceeding more smoothly than many anticipated, according to Petar Ganev, senior economist at the Institute for Market Economics, who spoke to the Bulgarian National Radio.

“Operationally, trade - particularly in large retail chains - and banking preparations are progressing well,” Ganev noted. He emphasized the importance of measured communication by institutions and the media, which helps keep public sentiment calm and avoids unnecessary pressure on the transition.

Currently, around 16 billion leva remain in circulation from the traditional 30 billion, while over 3 billion euros are already in use. Although the leva still dominates, Ganev stressed that the transition is effectively one-way: all business income is moving into euros, and any leva collected by large retailers flows to banks and ultimately to the Bulgarian National Bank. “Even smaller shops, whether in the Northwest or elsewhere, will inevitably see euros become the dominant currency in the near future,” he said.

On the topic of price adjustments, Ganev acknowledged that rounding is occurring, but described it as a minor, normal effect of about 0.5%, which facilitates the use of coins and smoother transactions. While isolated price increases exist in some locations, he stressed that there is no evidence of widespread inflationary practices linked to the euro introduction.

Regarding public finances, Ganev expects December 2025 data to show a 5–6% increase in salaries in the budget sector. He reassured that ongoing payments of pensions and salaries, along with the usual mid-year indexation, will prevent disruptions in daily life. At the macroeconomic level, he suggested that careful management of investment funds may be necessary due to the lack of an adopted budget. “Without a finalized budget, investment and spending are naturally more cautious, focusing on liquidity and revenue management,” Ganev explained.

Looking ahead, he noted that the first half of the year will likely be spent operating under the current budget framework. The formation of a new parliamentary majority following elections will determine whether spending can proceed more fully, or whether extended budget management will continue for most of 2026.

Source: BNR interview