The European Central Bank has concluded that none of the five European Union member states still outside the euro area are currently ready to adopt the single currency, with inflation, fiscal deficits, interest rates and legal shortcomings continuing to prevent accession.
In its 2026 Convergence Report, published every two years, the ECB assessed the Czech Republic, Hungary, Poland, Romania and Sweden against the legal and economic criteria required for joining the euro. While the report notes that all five economies have remained resilient despite external shocks, it concludes that progress since the previous assessment in 2024 has been limited.
The findings arrive at a time when European policymakers face a more complicated economic environment than during the previous review. Russia’s war against Ukraine continues to affect regional economies, while the conflict in the Middle East has increased volatility in energy markets. At the same time, global trade tensions continue to weigh on growth prospects and inflation across Europe.
The result is that none of the five countries currently satisfies all of the Maastricht convergence criteria, meaning the euro area will remain unchanged for the foreseeable future.
Five Countries, Five Different Problems
Although all five countries remain outside the euro, they are not equally far from joining.
The Czech Republic and Sweden performed relatively well on inflation, both recording average inflation below the ECB’s reference value of 2.7%. Hungary, Poland and Romania all exceeded that threshold, with Romania recording the highest inflation among the countries under review.
The picture becomes even more mixed when the remaining convergence criteria are examined. Hungary, Poland and Romania continue to run fiscal deficits above the Maastricht limit of 3% of GDP, while long-term borrowing costs remain elevated in those same three countries.
Perhaps most importantly, none of the five participates in the Exchange Rate Mechanism II, the mandatory waiting room that countries must enter before adopting the euro. Without joining ERM II, euro adoption cannot proceed regardless of performance on other economic indicators.
| Country | Inflation Criterion | Fiscal Deficit | ERM II Member | Overall Status |
|---|---|---|---|---|
| Czech Republic | Meets | Meets | No | Not eligible |
| Sweden | Meets | Meets | No | Not eligible |
| Hungary | Fails | Fails | No | Not eligible |
| Poland | Fails | Fails | No | Not eligible |
| Romania | Fails | Fails | No | Furthest from meeting criteria |
The report also concludes that legislation in all five countries remains incompatible with the legal framework governing the euro area. National laws relating to central bank independence and integration into the Eurosystem must be amended before accession can take place.
That legal hurdle often receives less attention than inflation or fiscal deficits, yet it represents a mandatory condition for euro adoption.
Romania, Hungary And Poland Face The Largest Economic Obstacles
Fiscal policy has become one of the biggest areas of divergence since the ECB’s previous assessment.
According to the report, Hungary, Poland and Romania all exceeded the EU’s 3% deficit ceiling during 2025. Romania remains subject to an Excessive Deficit Procedure first opened in 2020, while Hungary and Poland joined the procedure during 2024.
The European Commission does not expect any of the three countries to reduce their deficits below the required threshold before the end of 2027.
| Country | 2025 Fiscal Position | Excessive Deficit Procedure | Correction Deadline |
|---|---|---|---|
| Romania | Above 3% | Yes | 2030 |
| Hungary | Above 3% | Yes | 2026 |
| Poland | Above 3% | Yes | 2028 |
| Czech Republic | Below 3% | No | Not applicable |
| Sweden | Below 3% | No | Not applicable |
Debt dynamics also differ considerably.
While Hungary already exceeds the Maastricht debt ceiling of 60% of GDP, the European Commission projects both Poland and Romania will cross that threshold during 2026 if current trends continue.
Borrowing costs reinforce the same picture. The ECB’s reference value for long-term interest rates stands at 5.1%, yet Poland averaged 5.4%, while both Hungary and Romania averaged 6.7%, suggesting investors continue demanding higher risk premiums than those observed in the euro area.
Countries Meeting Each Maastricht Criterion
| Criterion | Countries Meeting Requirement |
|---|---|
| Inflation | 2 of 5 |
| Fiscal deficit | 2 of 5 |
| Long-term interest rates | 2 of 5 |
| ERM II participation | 0 of 5 |
| Legal compatibility | 0 of 5 |
Politics May Matter More Than Economics
The report also illustrates that euro adoption has increasingly become a political decision as much as an economic one.
Sweden provides the clearest example. Economically, the country performs well against most convergence indicators and maintains some of Europe’s strongest public finances. Yet successive Swedish governments have declined to join ERM II following the country’s 2003 referendum rejecting euro adoption.
The Czech Republic finds itself in a similar position. While its macroeconomic indicators compare favorably with many euro area members, Prague has not sought entry into ERM II, effectively postponing accession indefinitely.
Hungary and Poland have likewise shown limited political appetite for adopting the euro in recent years, while Romania remains the only country that continues to publicly support eventual accession despite still facing the largest convergence gaps.
| Country | Main Barrier Today |
|---|---|
| Sweden | Political choice not to join ERM II |
| Czech Republic | No ERM II participation |
| Poland | Inflation, fiscal deficit and political priorities |
| Hungary | Inflation, fiscal deficit and governance concerns |
| Romania | Inflation, fiscal deficit, debt trajectory and institutional weaknesses |
The report also highlights institutional quality as an increasingly important determinant of sustainable convergence. With the exception of Sweden, the ECB says there remains room for improvement in governance and institutional effectiveness, particularly in Hungary and Romania.
The assessment comes as the ECB continues to balance inflation control with slowing economic growth across the euro area. FinanceFeeds recently reported on the ECB’s latest monetary policy decisions, while broader geopolitical developments, including energy market volatility linked to the Middle East conflict, continue influencing inflation expectations across Europe.
The convergence report makes clear that none of the remaining EU member states is close to joining the euro in the near term. Even countries that satisfy several economic indicators continue to face legal or political obstacles, while those with the strongest political commitment remain furthest from meeting the required economic conditions.
Takeaway
The ECB’s latest assessment shows that euro enlargement has effectively stalled. While the Czech Republic and Sweden satisfy several economic requirements, neither has entered ERM II, making accession impossible under current rules. Romania, Hungary and Poland continue to struggle with inflation, fiscal deficits and borrowing costs. Combined with legal incompatibilities across all five countries, the report suggests the euro area’s membership is unlikely to expand before the end of the decade unless both economic conditions and political priorities change substantially.
