The lek closes a "triumphant" year / Euro exchange rate in annual decline by more than 9%

2023-12-29 18:00:00, Ekonomi CNA

The lek closes a "triumphant" year / Euro exchange rate in annual

Illustrative photo

The lek has closed the year 2023 in a significant appreciation compared to the previous year.

According to the official exchange rate of the Bank of Albania, the Euro was exchanged on Friday (the last day the official exchange rate is published for this year) at the level of 103.88 ALL. Compared to the last day of 2022, the Euro-Lek exchange rate has fallen by 9.1%.

The exchange rate with most of the other main currencies also showed a downward trend.

The exchange rate of the US Dollar with the Lek ended the year at the level of 93.94 Lek, down by 12.2% compared to the end of last year.

The exchange rate of the British Pound with the Lek closed the year at the value of 119.47 Lek, down by 7.3% compared to the end of last year.

The Swiss franc ended the year at the value of 112.1 ALL, down 3.5% compared to a year ago.

The lek has had its best exchange rate year for the past year. The overvaluation against the Euro touched the level of 14% during the summer, when the exchange rate simultaneously marked the lowest historical level, with 100.49 ALL. Subsequently, the exchange rate had an upward correction, but maintaining the annual appreciation trend of the Lek.

After stabilizing near the level of 106 Lek at the end of the summer season, during the month of November the Lek strengthened again, reaching the limit of 101 Lek, mainly as a result of the income from the sale of electricity. In December, the Euro regained some ground, due to the increase in the supply of Lek in the market, as a result of the strong increase in public spending in the last weeks of the year.

The appreciation of the Lek this year is especially the result of the significant improvement of the Balance of Payments, but also of a very restrictive fiscal policy followed by the Albanian Government.

In the third quarter of 2023, the current account balance was positive in the amount of 354 million euros, compared to a deficit of 145 million euros that was recorded in the same period a year ago. This caused the current account balance to be positive in the amount of 28 million euros for the 9-month period. At least since the opening of the Albanian economy, this is the first time that Albania has a progressive positive current account balance. The main impact on the improvement of the Balance of Payments was given by the record increase in income from tourism.

The fiscal surplus this year has reached the highest historical levels, culminating with the amount of 51

billion ALL in the month of September. This has significantly tightened the offer of Lek in the foreign exchange market, except for the month of December, when the high concentration of expenses has brought about a slight devaluation./ Monitor magazine