The fiscal loosening of the measures was a temporary phenomenon during a period of political instability, and the country can now return to prudent fiscal policy. This was said by Bulgarian National Bank (BNB) Deputy Governor Petar Chobanov, Head of the Banking Department, during a discussion he took part in at the high-level conference “Building Resilience Together: Bulgaria’s Membership in the ESM”, held on Friday at the Grand Hotel Millennium Sofia. The event is jointly organised by the Ministry of Finance and the European Stability Mechanism (ESM).
Speaking about inflation, the BNB Deputy Governor said that the most important issue in these processes is identifying its causes.
Looking back at the recent past, Chobanov recalled that an external shock had been a driver of inflation in 2021, as a result of disruptions to supply chains, Russia’s war against Ukraine and the subsequent energy price shock.
Subsequently, however, he pointed out that domestic factors began to have an impact on inflation in Bulgaria, stemming mainly from the services sector as a result of rising wages and fiscal spending.
When inflation is driven by consumption, the Government should take appropriate measures to create conditions for greater supply, Chobanov said, adding that reforms were also needed to improve the efficiency of the economy.
Taking measures to cool inflation anchors inflation expectations, and against the backdrop of a stable banking system, the BNB Deputy Governor said that the banking sector would continue to finance economic growth in order to achieve greater fiscal stability.
A special guest at the conference is ESM Managing Director Pierre Gramegna, who held a discussion with Deputy Prime Minister and Finance Minister Galab Donev.
The conference was being held to mark Bulgaria’s accession to the ESM on June 29, when it became the mechanism’s 21st member.
Fiscal Loosening Was Temporary Phenomenon during Political Instability, BNB Deputy Governor Chobanov Says THE NEWS FROM BULGARIA – NEWS AGENCY 2009-2025 2026-09-25 10:53:56
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