The Bulgarian National Bank (BNB) confirmed that the base interest rate (BIR) will remain unchanged, keeping its level from the previous month. According to the official announcement from the regulator, the BIR will be 1.82 per cent, effective from September 1. This decision marks a turning point in the dynamics of interest rate policy, as for the first time in a year, there will be no monthly reduction, which is also confirmed by a check of the Bulgarian News Agency (BTA) in the data of the central bank.
The last such case of an unchanged interest rate was registered exactly one year ago. At that time, at the end of August last year, the BIR was raised by 0.01 percentage point, reaching 3.54 per cent, effective from September. This historical moment highlights the current stabilisation, which follows a period of constant fluctuations.
Before the current cycle of changes began, the base interest rate in Bulgaria remained at a zero level for many years. This long era of zero rates ended abruptly at the end of September 2022, when the BNB initiated a series of consecutive increases. This was the first change to the BIR since 2016. Subsequently, over the past year and a half, the simple annual interest rate has consistently moved in a downward direction, reflecting the changing economic conditions.
Significance of the base interest rate
The central bank's decision to keep the BIR at its current level has a significant impact on the country's economic life, as the base interest rate is a key indicator and is used primarily to calculate the annual interest on various types of obligations. This affects both businesses and households that rely on lending. Analysts and economists closely monitor these changes, as they give a clear signal about the direction of monetary policy in the country.
- BNB
- Base interest rate (BIR)
- Bulgaria's economy
- Monetary policy
- Interest rates on loans
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