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The paper examines the current state and development of the Bulgarian economy in 2023, considering domestic and regional factors. We analyze the real sector by tracking GDP, inflation, and unemployment, linking these to EU processes. Emphasis is placed on labour market adjustments in the context of digitalization and transitioning to a climate-neutral economy. The sustainability of the fiscal sector is explored through financing the green and digital transition with EU funds, and the necessary policies to maintain fiscal stability. We discuss foreign trade prospects, considering the economic conditions and expectations for Bulgaria's main trading partners, the high dependence on euro area performance, and the specifics of foreign trade relations. The banking sector and the capital market analysis focus on the implications of European Central Bank monetary policy, regulatory actions of the Bulgarian National Bank, and risks to sector stability in a dynamic macroeconomic environment. Expectations and forecasts for the Bulgarian economy through 2026 are based on assumptions about global economic processes and local challenges. We make economic policy recommendations aimed at preserving the purchasing power of the population's income and restructuring certain fiscal measures. [ABSTRACT FROM AUTHOR]

Over the past few years, artificial intelligence (AI) and machine learning (ML) have become increasingly important in central banks' policy-making and monetary policymaking processes. The global financial crisis of 2008-2009, the COVID-19 pandemic, as well as various other episodes of high economic uncertainty since the turn of the millennium have adjusted central banks to a number of serious challenges and have led to the expansion of these mandates and emerging and exploiting new and extensive data. The study briefly notes on this as a big database (big data) and applications of AI/ML-based techniques that can provide support on monetary policy decisions, especially during times of uncertainty in the economy, referring to the latest research in this area. Also, concrete examples based on the creation of big data and AI/ML techniques applied in the activities of the European Central Bank and other central banks in Europe and the rest of the world are considered and analyzed. The analysis reveals that big data and AI/ML methods have demonstrated successful utility in conducting monetary policy by central banks. Although useful as a complement, these tools cannot be regarded as replacements for conventional data and methods due to issues related to statistics, the ability to interpret outcomes and ethical dilemmas. [ABSTRACT FROM AUTHOR]

The paper examines the current state and development of the Bulgarian economy in 2022 and the first quarter of 2023 considering domestically determined and regional factors and processes. We analyse the real sector of the Bulgarian economy by tracing the dynamics of economic activity (GDP, inflation, and unemployment) considering internal and external factors affecting inflation dynamics and labour market processes. The sustainability of the fiscal sector is viewed through the possibilities of financing the green and digital transition using EU funds and programmes, and the policies needed to preserve the fiscal stability. Prospects for foreign trade are discussed in terms of the economic situation and expectations of Bulgaria's main trading partners, considering the high connectivity with the euro area and the structural specificities of foreign trade relations. The analysis of the financial sector (banking sector and capital market) focuses on the implications of the monetary policy pursued by the European Central Bank and the regulatory actions of the Bulgarian National Bank, as well as on the risks for the stable functioning of the sector in a dynamic macroeconomic environment. Expectations and forecasts for the Bulgarian economy to 2025 are based on key assumptions about the global economic processes and locally determined challenges. Recommendations are made to the national economic policy aimed at preserving the purchasing power of the population's income and the need to restructure certain fiscal measures. [ABSTRACT FROM AUTHOR]

Any anti-crisis macroeconomic policy includes monetary and fiscal policy. The construction of anti-crisis macroeconomic policy in the conditions of a small open economy in a currency board and a virus pandemic raises the question of which measures should be the foundation and which measures should play a complementary macroeconomic role. This issue is extremely important because it predetermines both the efficiency and effectiveness of counter-cyclical policy. This study deals with the structuring of the main and complementary role of the fiscal and monetary policy in the general anti-crisis policy of Bulgaria. The focus is on 2020, looking at the impact of aggregate fiscal multiplier and monetary measures on GDP, based on extrapolation. A mathematical analysis is realized, which leads to quantitative results that illustrate the impact of fiscal and monetary policy on GDP development in a predictable short-term period which covers 2020 on a quarterly basis. [ABSTRACT FROM AUTHOR]