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The Citizen
2 days ago
- Business
- The Citizen
Bulgaria to adopt euro in 2026 after final EU approval
After years of political turbulence and economic scrutiny, Bulgaria is set to ditch the lev for the euro, becoming the eurozone's 21st member. The 'Euro Sculpture' by German artist Ottmar Hörl in front of the former seat of the European Central Bank (ECB) at the Eurotower. Picture: Kirill Kudryvstev / AFP EU ministers gave the final green light on Tuesday for Bulgaria to adopt the euro on January 1, 2026, making it the single currency area's 21st member. Bulgaria's switch from the lev to the euro comes nearly 19 years after the country of 6.4 million people joined the European Union. 'We did it!' Bulgarian Prime Minister Rossen Jeliazkov said. 'We thank all institutions, partners and everyone whose efforts made this landmark moment possible. The government remains committed to a smooth and effective transition to the euro in the interest of all citizens,' Jeliazkov said on X. 'Building a brighter future' In adopting the legal texts necessary for the move, EU finance ministers officially set the euro at 1.95583 Bulgarian lev. 'Joining the euro area is much more than just about replacing lev with euro. It is about building a brighter and more prosperous future for Bulgaria and its citizens at the heart of Europe,' EU economy chief Valdis Dombrovskis said after the approval. 'The euro will bring new opportunities, investments, jobs and growth,' he said. The European Commission last month said the EU's poorest country had fulfilled the strict conditions to adopt the euro, while the European Central Bank (ECB) also gave a positive opinion. ALSO READ: Tanzania Airlines blacklisted by EU, but safe in South African skies – Sacaa A divided society Bulgaria's journey to joining the eurozone has had a stormy political backdrop with seven elections in three years — the last in October 2024. But recent polls show Bulgarian society remains divided on the euro, with experts attributing the scepticism largely to fears of rising prices and declining purchasing power. President Rumen Radev shocked many when he proposed holding a referendum on the matter but that was given short shrift by the Bulgarian parliament. Since June, protesters have gathered in Sofia to call for 'keeping the Bulgarian lev'. A symbolic protest camp with several tents has been set up near the presidency and the Bulgarian National Bank in the capital. Far-right opposition parties have used the issue to promote anti-EU narratives. Proponents in Bulgaria, however, insist the move will help improve the country's economy, and reinforce its ties to the West and protect against Russia's influence. 'The political benefits are becoming increasingly significant, as the protests against the euro seem to bear the mark of the Kremlin,' 43-year-old musician Veselin Dimitrov told AFP in Sofia. ALSO READ: Shein risks fines over breaches of EU consumer law Euro club gets bigger The green light comes as the euro has been gaining in value against the US dollar as President Donald Trump's protectionist trade policies shake trust in the US currency. Only 12 countries were part of the single currency area — including France, Germany, Italy, Spain, and Greece — when the first euro bills and coins were rolled out on January 1, 2002. It gradually widened with Slovenia joining in 2007, Cyprus and Malta in 2008, Slovakia in 2009, Estonia in 2011, Latvia in 2014 then Lithuania in 2015. Croatia was the last country to join in 2023, bringing the total to 20. Bulgaria wanted to adopt the euro sooner but Brussels judged its inflation was too high to meet the necessary criteria. Conditions for joining EU states that want to join the single currency must demonstrate that their economy has converged with other eurozone countries and that they have their finances under control. The conditions include holding inflation to no more than 1.5 percentage points higher than the rate of the three best-performing EU countries. When Brussels gave its backing in June, it said Bulgaria's average inflation rate during the 12 months to April 2025 was 2.7 percent, just below the needed level. NOW READ: EU names seven 'safe' countries to streamline asylum rejections
CNBC
05-06-2025
- Business
- CNBC
European stocks set to open higher as ECB widely expected to cut interest rates
The Euro Sculpture at Willy-Brandt-Platz in the financial district of Frankfurt, Germany, on March 6, 2025. Bloomberg | Bloomberg | Getty Images Good morning from London! This is CNBC's live blog covering all the action in European financial markets on Thursday. All eyes are on the European Central Bank, which is expected to announce a rate cut. Futures data from IG suggests London's FTSE will open 4 points higher at 8,802, Germany's DAX up 22 points at 24,276, France's CAC 40 unchanged at 7,804 and Italy's FTSE MIB 46 points higher at 40,123. The ECB's monetary policy decision is in focus for regional markets Thursday, with the central bank widely expected to trim interest rates by 25 basis points, taking its key rate, the deposit facility rate, to 2%. Expectations of a rate cut were cemented after flash data on Tuesday showed inflation in the euro zone hit a cooler than expected 1.9% in May. Read more here: The European Central Bank is almost guaranteed to cut rates. Here's what could happen next — Holly Ellyatt Traders work at the New York Stock Exchange on June 4, 2025. NYSE Asia-Pacific markets traded mixed and U.S. stock futures were near flat overnight with sentiment dented by U.S. data showing private sector hiring has hit its lowest level in over two years. Private sector payrolls rose by just 37,000 in May, coming in sharply below the Dow Jones forecast of 110,000 and raising investor worries about the softening job market and the impact on the economy. Those concerns weighed on the major averages during the session, too. Still, the market's recent gains — which have been powered by a surge in technology stocks — coupled with a blowout first-quarter earnings season, have revived sentiment on Wall Street. Nevertheless, investors remain cautious that more pain could be ahead in light of the Trump administration's tariffs. — Holly Ellyatt, Pia Singh
