Shqipëria Posted on 2025-01-30 13:20:00

Euro rises, exchanged for 100 lekë - Significantly improves after a strong depreciation of several months

From Ledina Elezi

Euro rises, exchanged for 100 lekë - Significantly improves after a strong

After months of depreciation of the euro against the lek, the European currency is now worth 100 lek. Since August, the euro had fallen below the 100 lek level and showed no signs of improvement until the last week of January.

According to official statistics from the Bank of Albania, the major euro-lek break was recorded on August 12. For the first time, the European currency would fall below the 100 lek level, thus establishing a new reality in the foreign exchange market.

In 2024, the exchange rate was accompanied by a deep decline in the euro and a strong appreciation of the lek. In the first months of last year, the exchange rate appeared somewhat stable, but in the second half of the year, the first signs of depreciation of foreign currencies against the local currency began to be seen.

Although the exchange rate has been accompanied by occasional fluctuations, since August, 1 euro has continued to be exchanged for less than 100 lekë. Specifically, the lowest level would be recorded on November 14, 2024, where 1 euro was exchanged for 98.11 lekë.

Meanwhile, 2025 started with a slight improvement. Compared to the last two days of December, where 1 euro was exchanged for 98.14 lekë and 98.15 lekë, on January 6, the European currency marked a slight increase, where 1 euro was exchanged for 98.23 lekë. In the last week of January, the exchange rate experienced a sudden increase.

In its latest report, the International Monetary Fund warned that if the euro were to revalue to 2022 levels, it would negatively impact the financial sector, households and businesses, through an increase in non-performing loans, given that a large portion of loans are in foreign currency. On the other hand, the rise of the European currency is expected to positively affect exporting businesses, which have contracts in euros, but will negatively affect imports.

In its most recent report, the International Monetary Fund stressed that the exchange rate should be allowed to adjust more flexibly, with intervention serving as a complementary tool to address non-fundamental fluctuations. Careful weighing of the costs and benefits of further reserve accumulation would also be important.

 

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