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Foreign exchange purchases by the BoA reached a new record in 2025, exceeding the 1 billion euro mark

2026-03-31 12:00:00, Ekonomi CNA

Foreign exchange purchases by the BoA reached a new record in 2025, exceeding

The Bank of Albania broke the record for foreign exchange purchases again last year. According to official statistics, during 2025 the Central Bank purchased 1 billion and 27 million euros, with the objective of increasing foreign exchange reserves, but mostly in order to curb the strengthening of the Lek exchange rate. The amount of foreign exchange purchased increased by 10% compared to the previous year.

The total value of purchases includes planned purchases, aimed at increasing foreign exchange reserves, but also those related to direct market interventions, aimed at preventing further decline in the exchange rate.

Planned purchases, in order to increase the foreign exchange reserve, constituted only a small part of the total amount purchased. Last year, they amounted to 297.9 million euros, an increase of 5% compared to the previous year.

Meanwhile, direct purchases, aimed at preventing further decline in the Euro-Lek exchange rate, reached a record amount of 729.1 million euros, up 12.1%. For the second consecutive year, the Bank of Albania undertook a long-term intervention in the foreign exchange market, with the objective of preventing further strengthening of the local currency.

Direct purchases began in May and continued uninterrupted until December. The month with the highest value of purchases was July, when the Central Bank purchased almost 236 million euros in the domestic foreign exchange market.

The publication of detailed figures from the Bank of Albania on foreign exchange market interventions provides a clearer picture of the central bank's influence on the exchange rate. In the absence of these interventions, the decline in the Euro exchange rate against the Lek would have been even greater.

According to statistics from the Bank of Albania, the Euro was exchanged on average last year at 97.85 lekë, the lowest level ever recorded. However, the rate of exchange rate decline in 2025 was significantly lower compared to the previous two years.

For 2025, the official average Euro-Lek exchange rate fell by 2.8%, from 7.4% in 2024 and 8.6% in 2023.

The average exchange rate of the Euro to the Lek has been continuously declining since 2013, excluding the year of the pandemic, 2020, a year in which most economic indicators suffered significant deviations, due to the impact of restrictive measures.

The Euro-Lek exchange rate closed 2025 at 96.77 Lek. This is the lowest historical rate recorded at the end of the calendar year and close to the all-time historical minimum level of 96.46 Lek, recorded just one week before the end of 2025.

Compared to the end of 2024, the Euro/Lek exchange rate on December 31st has decreased by 1.4%.

Meanwhile, the decline continued during the first quarter of 2026, when the Euro exchange rate touched new lows, below the 96 lek mark.

This year, the Bank of Albania plans to further increase its planned purchases of foreign exchange in the domestic market. 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./ Monitor Magazine