Bulgaria lowers its 2027 deficit goal to 3.5% of GDP under EU pressure
Bulgaria now targets a 2027 budget deficit of 3.5% of GDP, below its previous official forecast, as Brussels presses the euro zone newcomer.
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what happened
The Bulgarian government said on Friday it wants to shrink the 2027 budget deficit to 3.5% of economic output, below its earlier official forecast. Presenting the draft budget for next year, the cabinet said spending would fall by 3.9%, around 5,000 public administration posts would be eliminated, and some taxes would rise. It expects the economy to grow 2.5%.
Brussels opened an excessive deficit procedure in July because the country is running a deficit above the 3% of GDP ceiling set by EU rules. In a letter to the European Commission dated November 2, Sofia pledged a shortfall of about 5% of GDP this year, 4.2% in 2027 and 3.5% in 2028, and expects to return within EU limits in 2029. Public debt at the end of the second quarter was 28.7% of GDP, one of the lowest ratios in the bloc. The report was published by Reuters.
why it matters
For markets, the key point is that Bulgaria, which joined the euro in January, is moving toward fiscal consolidation under pressure from Brussels. That lowers risks for sovereign debt, but the open question is whether the targets are achievable with spending cuts and higher taxes.
market impact
Bulgarian bonds and the euro: tighter fiscal policy may ease risks to the country's debt
tags
instruments
sources
- Bulgaria aims to reduce 2027 deficit as EU pressure mounts — Reuters, 6 November 2026 at 11:17 UTC
- Bulgaria revises 2027 deficit target as EU pressure mounts — Reuters, 6 November 2026 at 13:41 UTC
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