site.btaUPDATED IMF Maintains 2.5% Growth Forecast for Bulgarian Economy This Year Amid Lower Expectations for EU and Global Economy

Bulgaria’s economic growth is expected to slow to 2.5% in 2025, down from 2.8% in the previous year, according to the spring edition of the International Monetary Fund’s (IMF) World Economic Outlook, titled “Policy Uncertainty Tests Global Resilience.”

The report primarily focuses on the shifting landscape of global trade policy following the introduction of new, higher tariffs by U.S. President Donald Trump and the subsequent developments.

The IMF has maintained its previous forecast for Bulgaria, which was issued in October 2024.

This comes against the backdrop of a downward revision of global economic growth to 2.8%, down from 3.3% forecast in January.

IMF Managing Director Kristalina Georgieva warned of this slowdown last week, although she emphasized that she does not expect a global recession. 

The IMF projects a modest GDP growth of 1.0% for the eurozone, in line with the winter interim forecast of 0.8–1.0%. The EU as a whole is also expected to see a slowdown, with projected growth at 1.2%, down from 1.4% in January.

Regarding inflation in Bulgaria, the IMF anticipates it will accelerate to 3.7% in 2025, up from 2.6% in 2024. This is 1.1 percentage points higher than its October forecast.

In a more positive development, unemployment in Bulgaria is expected to decline to 4.1% in 2025, down from 4.2% in 2024. The IMF’s autumn forecast had projected the unemployment rate to remain at 4.2%.

For the first time, the IMF has provided forecasts for Bulgaria in 2026, after issuing long-term projections for major economies back in January. The Fund expects GDP growth to pick up to 2.7%, inflation to slow down to 2.3%, and unemployment to remain at 4.1%.

Last week, Bulgarian National Bank Governor Dimitar Radev presented an updated macroeconomic forecast, stating during a meeting with business leaders that GDP growth will remain at 2.8% in 2025, the same as in the previous year. For 2026, however, the central bank forecasts a temporary slowdown to 2.2%. The main drivers of this growth will be private consumption, government investment, and net exports, with varying contributions across the years, Radev noted.

According to the updated medium-term budget forecast (2025–2028) by the Ministry of Finance, on which the 2025 budget is based, Bulgaria’s GDP is projected to grow by 2.8% in 2025 and 3.0% in 2026.

A more optimistic projection has come from the rating agency Fitch, which in its latest report earlier this month forecast Bulgaria’s GDP to grow by 3.1% in 2025.