The euro area, or eurozone, is the group of EU countries that use the euro as their currency. Since Bulgaria joined on 1 January 2026, it has 21 of the 27 EU member states, and its monetary policy is set by the European Central Bank.
The euro area is the group of EU member states that have replaced their national currency with the euro. Its 21 members are Austria, Belgium, Bulgaria, Croatia, Cyprus, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Portugal, Slovakia, Slovenia and Spain.
The euro was launched on 1 January 1999 in 11 countries, first only for bank transfers and financial markets. Banknotes and coins followed on 1 January 2002. Other countries joined one by one, most recently Croatia in 2023 and Bulgaria in 2026.
Sharing a currency means sharing a central bank. The European Central Bank (ECB), in Frankfurt, sets interest rates for the whole euro area, with the national central banks of the member countries. Governments keep their own budgets and taxes, but they must respect common EU rules on public deficits and debt, and their finance ministers coordinate in the Eurogroup.
Six EU countries do not use the euro: Czechia, Denmark, Hungary, Poland, Romania and Sweden. Their situation is not the same. Denmark negotiated an “opt-out” and is not required to join. All the others are legally expected to adopt the euro once they meet the convergence criteria, economic conditions agreed in Maastricht in 1991 and set out in a protocol to the Treaties. No deadline has been set, and until they qualify these countries keep a temporary exemption, called a derogation.
Example
Bulgaria joined the EU in 2007 and adopted the euro on 1 January 2026, becoming the 21st member of the euro area. The conversion rate was fixed at 1.95583 Bulgarian lev for one euro. Since that date, the ECB’s interest-rate decisions apply in Bulgaria as in the other 20 countries.
Debates and limits
The euro is also used outside the EU. Andorra, Monaco, San Marino and Vatican City use it under formal agreements with the EU, while Montenegro and Kosovo use it without such an agreement. They are not part of the euro area and have no seat at the ECB.
Supporters of the single currency point to the end of exchange costs within the area and easier price comparison across borders. Critics argue that a single interest rate cannot suit economies in very different situations, a debate that was intense during the European sovereign debt crisis of 2009 to 2012, after which EU leaders pledged to strengthen the governance of the economic and monetary union.