Bulgaria’s tourist arrivals growth moderated to 3.50% YoY in October 2025, down from 6.30% in September and below the 6.70% consensus. This deceleration follows a volatile year marked by a rebound from pandemic lows and seasonal fluctuations. The October figure remains positive but signals caution amid evolving macroeconomic and geopolitical conditions.

Drivers this month

• Weaker demand from key European markets amid inflationary pressures.
• Seasonal off-peak travel patterns reducing volume compared to summer months.
• Lingering geopolitical tensions in Eastern Europe affecting regional travel sentiment.

Policy pulse

Bulgaria’s accommodative monetary stance and government support for tourism infrastructure continue to underpin the sector. However, rising borrowing costs in the Eurozone and cautious fiscal tightening may dampen near-term growth.

Market lens

Following the release, the Bulgarian lev (BGN) showed mild depreciation against the euro, reflecting investor caution. Short-term yields on Bulgarian government bonds edged higher, signaling modest risk repricing.

Tourism is a vital component of Bulgaria’s GDP, contributing roughly 12% directly and indirectly. The 3.50% YoY increase in arrivals contrasts with the broader economic backdrop: Bulgaria’s GDP growth slowed to 2.10% in Q3 2025, inflation remains elevated at 5.40%, and unemployment holds steady at 6.70%. These factors interplay with tourism demand and spending.

Monetary policy & financial conditions

The Bulgarian National Bank maintains a fixed exchange rate peg to the euro, limiting independent monetary policy. Eurozone rate hikes have increased borrowing costs regionally, indirectly affecting Bulgarian credit conditions. The central bank’s cautious approach aims to balance inflation control with growth support.

Fiscal policy & government budget

Fiscal stimulus targeting tourism infrastructure and marketing campaigns continues, with a 1.20% of GDP allocation in 2025. However, rising public debt (currently 25% of GDP) constrains further expansion. The government’s budget aims for a slight surplus in 2026, signaling moderate fiscal tightening ahead.

External shocks & geopolitical risks

Regional instability, including tensions in Ukraine and energy supply uncertainties, weigh on travel confidence. Additionally, inflationary pressures in Europe reduce disposable income for outbound tourism, impacting Bulgaria’s inbound flows.

Comparing the current print with historical data, October 2025’s growth is well below the 6.10% recorded in January 2025 and the 2.50% in December 2024. The volatility underscores the sensitivity of Bulgaria’s tourism sector to macroeconomic cycles and geopolitical events.

Market lens

Immediate reaction: The Bulgarian lev weakened 0.10% against the euro within the first hour post-release, while 2-year government bond yields rose by 5 basis points, reflecting cautious investor sentiment.

Looking ahead, Bulgaria’s tourist arrivals face a mixed outlook shaped by global economic conditions, regional stability, and domestic policy. Three scenarios frame the near-term trajectory:

Bullish scenario (30% probability)

• Improved geopolitical stability and easing inflation in Europe boost travel demand.
• Government ramps up tourism promotion and infrastructure investment.
• Tourist arrivals accelerate to 5-6% YoY growth by Q2 2026.

Base scenario (50% probability)

• Moderate inflation persists, limiting discretionary travel spending.
• Geopolitical risks remain contained but weigh on sentiment.
• Tourist arrivals stabilize around 3-4% YoY growth through 2026.

Bearish scenario (20% probability)

• Escalation of regional conflicts or energy shocks disrupt travel flows.
• Fiscal tightening and higher borrowing costs reduce tourism investment.
• Tourist arrivals contract or stagnate, with growth near 0% or negative.

Policy pulse

Monetary policy remains constrained by the currency peg, placing the onus on fiscal measures. Targeted government support for tourism and infrastructure will be critical to sustaining growth.

Bulgaria’s October 2025 tourist arrivals growth of 3.50% YoY signals a moderation from recent highs amid a complex macroeconomic and geopolitical environment. While the sector remains resilient, risks from inflation, regional instability, and fiscal constraints temper near-term prospects. Strategic policy support and external stability will be key to unlocking Bulgaria’s tourism potential and broader economic growth.

Key Markets Likely to React to Tourist Arrivals YoY

Tourism data influences a range of markets sensitive to economic growth and regional stability. The Bulgarian lev (BGNEUR), the Bulgarian government bond market (BGGB2Y), and regional equity indices typically respond to shifts in tourist flows. Additionally, the EURUSD forex pair reflects broader Eurozone economic sentiment, which impacts Bulgaria indirectly. Finally, crypto assets like BTCUSD often react to risk sentiment shifts tied to macroeconomic data.

Frequently Asked Questions

What is the current trend in Bulgaria’s tourist arrivals YoY?

The latest data shows a 3.50% YoY increase in October 2025, indicating a slowdown from previous months but positive growth overall.

How do macroeconomic factors affect Bulgaria’s tourism sector?

Inflation, GDP growth, and fiscal policy influence disposable income and investment in tourism infrastructure, impacting arrivals.

What are the main risks to Bulgaria’s tourism growth?

Geopolitical tensions, energy supply shocks, and tightening fiscal conditions pose downside risks to tourist arrivals.

Key takeaway: Bulgaria’s tourism sector shows resilience but faces headwinds from macroeconomic and geopolitical challenges, requiring targeted policy support to sustain growth.

BGNEUR – Bulgarian lev exchange rate, sensitive to tourism inflows.

BGGB2Y – Bulgarian government 2-year bond yield, reflects risk sentiment.

BGSE – Bulgarian stock exchange index, impacted by economic growth.

EURUSD – Euro to US dollar, proxy for Eurozone economic conditions.

BTCUSD – Bitcoin to US dollar, reflects global risk appetite.