ECB says no countries on euro waiting list ready to join bloc

LONDON, UK – The European Central Bank has said that none of the eight countries that are supposed to join the 17-nation euro currency block are ready yet.

In its latest convergence report, published Wednesday and based on the eight states’ inflation, deficits, exchange rates, long-term interest rates and legal compliance with the eurosystem of central banks, the ECB said that Bulgaria, the Czech Republic, Latvia, Lithuania, Hungary, Poland, Romania and Sweden are not yet ready to join the euro, the BBC reports.

Of the 10 EU countries that are not in the euro zone, only the UK and Denmark have secured opt-outs from joining the currency, and the rest are supposed to join at some point. But the ECB said today that “in none of the eight countries examined [was] the legal framework… fully compatible with all requirements for the adoption of the euro.”

Regarding Latvia and Lithuania – the countries most likely to join the euro next – the ECB said that both Baltic states face a “challenging” inflation outlook that could hamper their convergence with the euro, despite the countries’ pegging of their currencies to the euro with the aim of joining the union in 2014, Bloomberg reports.

“Maintaining low inflation rates at all times in Latvia will be challenging in the medium term, given monetary policy’s limited room for maneuver under the fixed exchange-rate regime,” the ECB said, while in relation to Lithuania, “it may be difficult to prevent macroeconomic imbalances, including high rates of inflation, from building up again,” it added.

According to Reuters, interest among non-euro zone EU member states in joining the euro has faded due to the debt crisis raging in the bloc, although Poland's Prime Minister Donald Tusk said earlier in May that the country was still ready to join the euro.