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The Bank of Albania intervenes again in the foreign exchange market to stop the fall of the euro

2024-10-12 09:30:00, Ekonomi CNA

Bank of Albania

The Bank of Albania has resumed interventions in the foreign exchange market in the first ten days of October.

According to sources from the market, the Central Bank intervened by buying euros on October 3, 9 and 10. However, the market agents state that the interventions were smaller compared to those of the summer months.

In particular, the Bank of Albania has made purchases only with specific banks and mainly with those that have quoted the lowest levels of the purchase rate (bid) during these days.

The values ??of the currency purchased during these operations have not been made public by the Bank of Albania.

The interventions of the Bank of Albania, however, have not brought an increase in the exchange rate, which on Thursday even touched a new historical minimum, in the value of 98.7 ALL. However, it can be assumed that in the absence of the Bank of Albania's interventions, the fall in the euro exchange rate could have been even greater.

The Bank of Albania began direct intervention in the foreign exchange market in May this year, due to downward pressure on the euro-lek exchange rate. The interventions of the Bank of Albania lasted from May until the beginning of August. The official information of the purchases of the Bank of Albania is limited until the end of the second quarter.

Only in the first half of this year, the Bank of Albania has bought almost 272 million euros in the foreign exchange market, of which 134.2 million euros in the auctions planned for the needs of the foreign exchange reserve, while even more, 137.6 million euros, were bought with direct operations, in order to avoid further strengthening of the lek in the foreign exchange rate.

In the absence of these interventions, the euro exchange rate would most likely have touched lower levels during the period in question. After the withdrawal of the Bank of Albania, at the beginning of August, the exchange rate has remained below the limit of 100 ALL. On the other hand, this shows that the fall in the euro rate is a phenomenon less related to the foreign exchange flows of the summer holidays.

During 2024, with the objective of increasing the foreign exchange reserve, the Bank of Albania intends to purchase through auctions the amount of 250-330 million euros. For this purpose alone, 134 million euros were purchased in the first half of the year, with an increase of 15% compared to the same period of the previous year; if we also add direct purchases to influence the exchange rate, the anticipated range of purchases to be purchased in the domestic foreign exchange market has already been reached in the first half of the year./ Monitor.al