European Central Bank

The EU on Wednesday predicted lower inflation in the eurozone in 2024 than previously forecast but warned the single-currency area's economy still faced risks from geopolitical tensions including wars in Ukraine and Gaza.

Bulgaria's plan to adopt the euro and become a member of the eurozone holds far-reaching implications, especially for the economy, political scene, and international relations; the Southeast European nation is looking to improve its economic conditions and become a recognised voice in the European Central Bank (ECB).

Bulgaria and the Euro

The European Central Bank (ECB) has weighed in on Bulgaria's draft Law on the adoption of the euro, signaling the need for revisions to ensure alignment with European regulations. In an opinion published on the Bulgarian Ministry of Finance's website, the ECB underscores the importance of achieving full compliance with EU directives, particularly in the realm of monetary policy.

A wave of misinformation regarding Croatia's inflation rates has sparked concerns about the potential consequences of adopting the euro in Bulgaria. The spread of misleading claims, fueled by cherry-picked data and biased narratives, underscores the complexities surrounding economic discourse and public opinion.

The European Central Bank is "most likely" to cut interest rates just three times this year as stronger-than-expected economic growth supports inflation, Bank of Greece governor and ECB governing council member Yannis Stournaras has said.

The eurozone economy rebounded in the first quarter from a mild recession as Germany returned to growth and expansion accelerated elsewhere, while inflation steadied to reinforce the case for the European Central Bank to cut interest rates.

Greek banks made new purchases of bonds and investment assets amounting to 9.3 billion euros in 2023, financed by the excess liquidity secured through the increase in deposits, as in the absence of sufficient demand for new loans the credit sector is looking for investment opportunities with high yields.

The government plans an early repayment of up to €5 billion of bailout loans to eurozone countries this year, two government officials told Reuters on Tuesday.

The eurozone and the International Monetary Fund (IMF) lent Greece about €280 billion during the crisis on the condition that it impose tough austerity measures.

Business activity in the eurozone picked up in April thanks to "increasingly robust" growth in the services sector, a closely watched survey showed on April 23.

Experts suggest that Bulgaria's admission to the Eurozone is more realistic in January 2026, according to insights from Cinzia Alcidi of the Brussels Center for the Study of European Politics, as reported by Politico.