Families and businesses cannot save in lek, while foreign currency deposits increase by 130 million euros in July

2023-08-30 10:17:00, Ekonomi CNA

Families and businesses cannot save in lek, while foreign currency deposits

Although the local currency is the lek, and the income of most families and individuals is in the lek, it seems that the biggest profits are in euros.

At least this is shown by the trend of deposits according to the type of currency in July, where savings in lek are decreasing while those in foreign currency are showing a significant increase.

According to the Bank of Albania, at the end of July, the stock of ALL deposits reached ALL 545 billion, with a decrease of 0.3% compared to the same period a year ago, or ALL 1.8 billion less.

This decrease comes after the increase in June, which was the strongest since December 2022. After June, deposits in lek returned to the downward trend that they have shown throughout this year.

Despite the upward trend of interest rates in the last year, as a result of the restrictive monetary policy of the Bank of Albania, which increased the base rate several times to curb inflation, deposits in lek have not experienced any significant expansion. On an annual basis, savings in Lek increased by only 0.6%.

This may reflect both the inability to save, due to the very high rate of growth of prices in relation to income, as well as the channeling of investments in government securities, which had higher interest rates than deposits.

Currency savings increase by 130 million euros

Unlike the savings in Lek, those in foreign currency have recorded steady growth in recent years. (Monitor is reporting foreign currency deposits from the special statistics for the euro, which prevails, since the total data of the Bank of Albania's deposits are given in lek, which reduces the value of savings in euros due to the significant depreciation of the common currency) .

At the end of July, the stock of euro savings reached 6.8 billion euros, an increase of 1.9% compared to the previous month, or 130 million euros more, the strongest expansion since August last year.

On an annual basis, deposits in euros increased by 16.6%, or 976 million euros more.

In July and August, foreign currency deposits always show strong growth influenced by the inflow of immigrants.

In recent years, the good performance of tourism has also had an impact, which brings more foreign currency to the country both through consumption, the hotel industry, as well as individuals who rent out houses by the day, a trend that is getting stronger and stronger. especially in the summer months./Revista Monitor

Families and businesses cannot save in lek, while foreign currency deposits