Limited euro adoption progress in 5 EU states, ECB finds
The European Central Bank's 2026 Convergence Report finds limited progress by five non-euro area EU Member States towards adopting the euro. Economic convergence has stalled since 2024, primarily due to external shocks.
Inflation and fiscal gaps persist
The 2026 Convergence Report highlights limited economic convergence among the Czech Republic, Hungary, Poland, Romania, and Sweden since 2024.
External shocks, including geopolitical conflicts and global trade tensions, are identified as key impediments.
Regarding price stability, three of the five countries—Romania, Hungary, and Poland—recorded a 12-month average inflation rate above the 2.7 percent reference value.
Conversely, the Czech Republic and Sweden remained below this threshold.
Fiscal deficits have worsened in most nations, with Hungary, Poland, and Romania exceeding the 3 percent of GDP reference value in 2025.
Projections indicate rising debt-to-GDP ratios for Poland and Romania in 2026.
Furthermore, Poland, Hungary, and Romania also reported 12-month average long-term interest rates above the 5.1 percent reference value, indicating persistent challenges in sustainable convergence.
External headwinds and institutional lags
Despite showing resilience, economic activity in the reviewed countries varied, with the outlook clouded by heightened geopolitical tensions and energy market volatility.
None of the currencies of the five countries participate in the exchange rate mechanism (ERM II), and some have experienced significant fluctuations against the euro.
The report also underscores the importance of institutional quality for sustainable convergence.
With the exception of Sweden, international indicators suggest considerable room for improvement in governance and institutional frameworks, particularly in Hungary and Romania.
Crucially, national legislation in all five countries remains incompatible with the legal requirements for euro adoption, presenting a fundamental hurdle.
A sobering assessment
This biennial report paints a clear picture: the path to euro adoption remains arduous for these five EU members.
Persistent inflation, widening fiscal deficits, and unaddressed legal incompatibilities signal that fundamental reforms are still needed.
Without decisive domestic action, external shocks will continue to derail convergence efforts, keeping the euro out of reach for the foreseeable future.
Source: ECB reports on progress towards euro adoption
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