BG Current Account Report: November 2025 Release and Macroeconomic Implications
Table of Contents
The November 2025 current account reading for Bulgaria (BG) registered a deficit of -792.90 million BGN, a sharp reversal from the previous month’s surplus of 301.60 million BGN and well below the consensus estimate of -150 million BGN. This data, sourced from the Sigmanomics database, highlights a significant deterioration in external balances within the last 30 days. The current account has fluctuated widely over the past year, with a 12-month average near -150 million BGN, underscoring volatility in trade and capital flows.
Drivers this month
- Import costs surged due to higher energy prices and supply chain disruptions.
- Exports slowed amid weaker demand from key European partners.
- Services and income balances also contributed negatively, reflecting reduced tourism and remittance inflows.
Policy pulse
The current account deficit exceeds the central bank’s comfort zone, pressuring monetary authorities to maintain a cautious stance. Inflationary pressures from import costs may complicate the National Bank of Bulgaria’s policy calibration.
Market lens
Following the release, the Bulgarian lev (BGN) depreciated modestly against the euro, while short-term government bond yields rose, reflecting increased risk premiums.
Bulgaria’s core macroeconomic indicators provide context for the current account swing. GDP growth slowed to an estimated 1.20% YoY in Q3 2025, down from 2.50% in early 2025. Inflation remains elevated at 6.10% YoY, driven largely by energy and food prices. Unemployment held steady at 5.80%, but wage growth has lagged behind inflation, squeezing household purchasing power.
Monetary Policy & Financial Conditions
The Bulgarian National Bank has maintained a tight monetary policy stance, with key interest rates steady at 3.75%. Financial conditions have tightened amid global rate hikes and local inflation concerns. Credit growth slowed to 3.40% YoY, reflecting cautious lending and subdued investment appetite.
Fiscal Policy & Government Budget
Fiscal policy remains moderately expansionary, with a budget deficit of 2.80% of GDP projected for 2025. Increased public spending on infrastructure and social programs aims to support growth but adds pressure on external financing needs.
This chart signals a reversal of recent improvements in Bulgaria’s external position, highlighting vulnerability to external shocks and rising import dependency. The sharp deficit surge suggests increased external financing needs and potential pressure on the lev’s stability in the near term.
Market lens
Immediate reaction: The BGN/EUR exchange rate weakened by 0.30% within the first hour post-release, while 2-year government bond yields rose 12 basis points, signaling heightened risk perception among investors.
Looking ahead, Bulgaria faces a complex macroeconomic environment shaped by external and domestic factors. The current account deficit trajectory will depend on global commodity prices, European demand, and policy responses.
Bullish scenario (25% probability)
- Energy prices stabilize or decline, reducing import costs.
- EU economic recovery strengthens export demand.
- Fiscal consolidation improves investor confidence.
Base scenario (50% probability)
- Current account remains in moderate deficit (-500 to -800 million BGN).
- Monetary policy tightens slightly to contain inflation.
- Gradual improvement in services exports offsets goods deficit.
Bearish scenario (25% probability)
- Prolonged energy price shocks and supply disruptions.
- Geopolitical tensions disrupt trade flows.
- Fiscal slippage leads to higher borrowing costs and currency pressure.
Policy coordination between monetary and fiscal authorities will be critical to managing external imbalances and sustaining growth. Structural reforms to diversify exports and improve competitiveness remain urgent priorities.
Bulgaria’s November 2025 current account report reveals a significant external imbalance, driven by adverse trade dynamics and external shocks. The sharp deficit challenges policymakers amid inflationary pressures and fiscal constraints. While risks are tilted to the downside, opportunities exist if global conditions improve and domestic reforms advance. Close monitoring of financial markets and external financing conditions will be essential in the coming months.
Selected tradable symbols relevant to Bulgaria’s current account dynamics include:
- SOFIX – Bulgaria’s benchmark stock index, sensitive to macroeconomic shifts and investor sentiment.
- EURBGN – The Bulgarian lev’s peg to the euro makes this currency pair crucial for assessing exchange rate pressures.
- USDBGN – Reflects external currency risk and import cost fluctuations.
- BTCUSD – Cryptocurrency market volatility can influence capital flows and risk appetite.
- OMXS30 – Nordic equity index, a proxy for regional economic health impacting Bulgaria’s trade partners.
Key Markets Likely to React to Current Account
The current account deficit is a key indicator for markets tracking Bulgaria’s external stability. The SOFIX index often reflects investor confidence tied to macroeconomic health. Currency pairs like EURBGN and USDBGN respond to shifts in trade balances and capital flows. Regional indices such as OMXS30 provide insight into demand conditions affecting exports. Lastly, BTCUSD can signal broader risk sentiment impacting emerging market capital movements.
FAQs
- What is the significance of Bulgaria’s current account deficit?
- The current account deficit measures the gap between exports and imports of goods, services, and income. A large deficit can signal external vulnerabilities and pressure on currency stability.
- How does the current account affect Bulgaria’s monetary policy?
- A widening deficit can lead to currency depreciation and inflation, prompting the central bank to tighten monetary policy to maintain price stability.
- What are the main risks to Bulgaria’s external balance?
- Risks include volatile energy prices, geopolitical tensions disrupting trade, and fiscal imbalances increasing external borrowing needs.
Takeaway: Bulgaria’s sharp current account deterioration in November 2025 highlights external vulnerabilities amid global uncertainties. Coordinated policy action and structural reforms will be essential to restore balance and support sustainable growth.
This has been drafted with AI assistance and then thoroughly reviewed, refined, and approved by our human editorial team to ensure accuracy, and originality.
The current account deficit of -792.90 million BGN in November 2025 is a stark contrast to October’s surplus of 301.60 million BGN and well below the 12-month average deficit of approximately -150 million BGN. This represents the largest monthly deficit recorded in the past year, surpassing the previous worst deficit of -776.20 million BGN in May 2025.
Key contributors include a 15% MoM rise in import values, particularly energy and intermediate goods, while export growth slowed to 1.20% MoM. The services balance deteriorated by 120 million BGN, reflecting weaker tourism receipts.