Lyubomir Datsov attributes Bulgarian inflation to state policy and deficits

Lyubomir Datsov, a member of the Fiscal Council and former Deputy Minister of Finance, has identified state policy and budget deficits as the primary drivers of inflation in Bulgaria. Speaking on bTV, Datsov dismissed the notion that the adoption of the euro is responsible for rising prices, stating that the currency change itself is not a mechanism that automatically increases costs.

Datsov highlighted that the government's fiscal policies over the last four years have contributed significantly to inflationary pressure. He emphasized that the budget deficit is a key factor, noting that it impacts the entire economic environment beyond just increased spending.

Additionally, Datsov pointed to a 'heating up' of the labor market. He noted that rapid wage growth—which saw monthly increases of 20–26% in previous periods—exerts upward pressure on prices. He also mentioned that labor shortages, particularly of skilled workers, and external factors such as oil and fuel prices continue to influence the economic landscape.