The Bank of Albania will increase planned foreign exchange purchases to 450 million euros for 2025

2025-12-18 08:20:12, Ekonomi CNA

The Bank of Albania will increase planned foreign exchange purchases to 450

The Bank of Albania will further increase its planned purchases of foreign exchange in the domestic market for 2026. According to information from the Central Bank, it aims to purchase 330-450 million euros through auctions, with the aim of increasing foreign exchange reserves. The purchase target has increased significantly compared to the projections in the range of 270-350 million euros foreseen for 2025.

A total of 26 foreign exchange purchase auctions are scheduled for 2026, to be held between February and December. Of these, 9 will be one-month and three-month forward auctions, while 17 will be spot auctions.

For 2026, the highest concentration of purchases is expected in the summer season, when the foreign exchange supply is also greater. According to the calendar, a total of 12 foreign exchange purchase auctions will be held between June and August.

The maximum amount planned to be purchased in the first round will be 10-12 million euros, depending on the auction. However, regulations allow the Bank of Albania to also carry out purchases in a second round, at the average rate of purchases in the first round.

The above amounts do not include possible purchases for the purposes of intervention in the foreign exchange market, in order to stabilize the market or achieve monetary policy objectives.

According to the information published so far, for the first 9 months of 2025, the Bank of Albania has purchased approximately 800 million euros in the domestic foreign exchange market. For the most part, these are purchases outside the auction calendar, carried out through direct operations, with the aim of avoiding further strengthening of the Lek in the foreign exchange rate.

Meanwhile, according to the final official figures, for 2024 the Bank of Albania had purchased a total of 933 million euros in the foreign exchange market, at the highest value of all time.

The Bank of Albania's increasingly large purchases of foreign currency are due to the continuous downward trend of the Euro-Lek exchange rate. The high foreign exchange supply has caused the European currency exchange rate to reach new historical minimum levels this year, below the limit of 96.5 Lek. However, the depreciation of the European currency on an annual basis has dropped below the level of 2%, slowing down significantly compared to the previous three years.

The intervention of the Bank of Albania has been essential in slowing the decline of the Euro, which otherwise would have reached even lower levels. The interventions of the Bank of Albania in the foreign exchange market have been argued in function of the inflation target. In conditions where low inflation is mainly due to its imported component, the Bank of Albania has bought the Euro to prevent further strengthening of the Lek, because this would exert further downward pressures on inflation./ Monitor.al