Euro Hits Historic Low in Albanian Market

The euro's decline continues, reaching its lowest historical level in the domestic foreign exchange market. According to the official exchange rate of the Bank of Albania, the common currency is currently exchanged at 93.07 lekë, marking a decrease of 34% compared to its historical high of 140.4 lekë reached in February 2011.

The decline began in 2016 and has been influenced by informal flows from the growth of construction, as well as tourist inflows, with foreign national arrivals exceeding 12 million per year. The Albanian government's fiscal policy, which includes large fiscal surpluses for most of the year, is believed to have contributed to the strengthening of the Lek.

The Bank of Albania has been intervening in the foreign exchange market to buy currency, withdrawing almost 2.2 billion euros from the market since the beginning of 2024. However, these interventions have only partially controlled the decline of the Euro, and the Central Bank has intervened twice to buy Euros this week.