Sejko: The strengthening of the lek protected us from inflation and stimulated the growth of lending

2025-11-14 14:04:00, Ekonomi CNA

Sejko: The strengthening of the lek protected us from inflation and stimulated

The strengthening of the lek in the foreign exchange rate has protected the Albanian economy from external inflation and has enabled lower interest rates, boosting lending to the economy.

The Governor of the Bank of Albania, Gent Sejko, said today at a joint press conference with the IMF Mission Chief and the Minister of Finance, that the strengthening of the exchange rate has helped rebalance the external sector of the economy and curb the transmission of foreign inflation to the domestic market, enabling a more accommodative monetary policy course.

The growth in services exports has offset the decline in goods exports and the increase in imports, consolidating structural improvements in the balance of payments and continuing to exert upward pressure on the exchange rate. Low interest rates in the domestic market have fostered and continue to fuel relatively rapid credit growth, which has supported the expansion of domestic consumption and investment.

"I find it appropriate to underline that the two main pillars of our monetary regime: targeted inflation and a free exchange rate, have created the necessary flexibility in dealing with shocks," said Sejko.

He emphasized once again that the Bank of Albania's forecasts for the future remain positive.

"Overall, our projections suggest that the Albanian economy will continue to grow in the medium term, at rates similar to those of the current year. In our judgment, these growth rates will enable a good utilization of the country's productive resources, creating space for inflation to return to target in the first half of 2026 and stabilize around the 3% level in the following years."

"The Bank of Albania believes that the projections for a balanced performance of demand and supply in the economy also dictate the need for a balanced and neutral framework of macroeconomic policies. In this context, I would like to emphasize that the commitment of fiscal policy to continue the process of consolidating the budget deficit and public debt, as well as the free exchange rate regime, creates more space for monetary policy to react at the right time and in the right direction to control inflation and stabilize the economy," the Governor explained.

He added that the Bank of Albania will continue to work towards further convergence of the supervisory and regulatory framework with EU standards and best practices in the field.

"The continuation of the implementation of our tasks within the framework of the integration process, as well as the Albanian Financial System Sustainability Assessment Program (FSAP), which will be developed next year in cooperation with the IMF and the WB, will give us a good roadmap for the further reforms we need to undertake."

The Bank of Albania will remain committed to respecting its primary objective: that of maintaining price stability, as well as fulfilling all its other tasks, in the framework of financial stability, the development of financial markets and payment systems, as well as in the process of negotiations for Albania's integration into the EU. We will also continue to offer our expertise in the field of structural reforms necessary for faster, more sustainable and more inclusive economic growth,” said Sejko. /Monitor