Fitch and S&P Upgrade Bulgaria’s Credit Rating

In extraordinary rating actions, international credit rating agencies Fitch Ratings and S&P Global Ratings upgraded Bulgaria’s long-term foreign currency credit rating to ‘BBB+’ with a stable outlook.

This rating represents the highest level within the upper-medium investment grade category. The official decision by the Council of the European Union approving Bulgaria’s accession to the eurozone as of January 1, 2026, is cited as the primary driver behind the ratings upgrade.

In its rationale, S&P Global Ratings highlights that Bulgaria will benefit from the credible monetary policy of the European Central Bank (ECB) and from access to the well-developed capital markets of the monetary union.

The agency notes that currency risk will be significantly reduced and that Bulgaria’s EU membership and upcoming eurozone accession continue to support the implementation of key structural policies.

The agency assesses Bulgaria’s short-term growth prospects as stable, projecting real GDP growth of 2.4% in 2025, and an average of 2.8% through 2028. Private consumption is expected to be the main growth engine, driven by robust real wage growth due to a tight labour market.

Fitch Ratings sees euro adoption as positive for the rating, noting that membership in the euro area would confer reserve currency status on Bulgarian sovereign debt, strengthen the monetary policy framework, reduce transaction costs, eliminate exchange rate risk for businesses and households, and create additional opportunities for external financing. Bulgarian banks would also gain access to the ECB’s liquidity facilities.

Fitch projects real GDP growth of 2.8% in 2025, unchanged from 2024, as global trade uncertainty is offset by improvements in domestic political stability. Strong nominal wage growth, coupled with pre-euro adoption consumption increases, is expected to support steady household spending. Fitch forecasts real GDP growth of 2.5% in 2026, with potential for further upside related to euro adoption.