BNB Governor: Draft 2026 budget deepens negative fiscal trend

The proposed 2026 state budget, which envisages a deficit of 5.7% deepens rather than reverses the negative fiscal trend that has developed since 2020, Bulgarian National Bank Governor Dimitar Radev said in an interview with BTA during the ECB Forum on Central Banking in Sintra, Portugal. “With Bulgaria already subject to an excessive deficit procedure, such fiscal signals carry even greater weight”, Dimitar Radev added.

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According to the central bank governor, the Bulgarian National Bank’s macroeconomic forecast, which projects lower economic growth and higher inflation, does not in itself complicate fiscal policy, but reflects a less favorable external environment and existing domestic imbalances.

Dimitar Radev said Bulgaria's euro area membership had already begun to generate economic benefits. He noted that the transition is proceeding smoothly and in an orderly manner due to the long-term preparation by the Bulgarian National Bank and the banking sector.

Edited by Miglena Ivanova

Translated by Kostadin Atanasov