Euro reaches new low below 91.3 lek

The Euro-Lek exchange rate has returned to its downward trend and has touched a new historical minimum today. According to the official exchange rate of the Bank of Albania, the Euro was exchanged today for 91.29 Lekë, the lowest level of all time. Compared to a year ago, the Euro-Lek exchange rate is down by 5.6%.

Foreign exchange agents explain that the market continues to have high supply of currency and weak demand for it.

According to them, identifiable foreign exchange inflows come from several sources, starting from the exchanges carried out by businesses themselves in significant amounts, the ever-increasing transactions with bank cards in foreign currency, but also from the conversion of income from foreign currency debt securities of domestic banks.

Market experts explain that the banking sector has a very large portfolio of foreign currency debt instruments. These securities bring periodic income through coupons paid by the issuers. Income from foreign currency coupons is automatically converted into Lek. These actions consequently lead to an increase in the supply of Euro and the demand for Lek, exerting pressure for a further decrease in the Euro-Lek exchange rate.

Meanwhile, bank card transactions continue to generate an increasing supply of foreign currency. When a foreign currency cardholder makes a purchase in Lek, this automatically triggers an automatic transaction of selling foreign currency and buying local currency in the financial system.

Payments with foreign currency cards are typical mainly for foreign tourists, but some credit cards issued by Albanian banks are also linked to foreign currency accounts, mainly in Euros.

According to data from the Bank of Albania, a total of 16 million card payments were registered at electronic points of sale (POS) in the first six months of 2026. The number of card payments has increased by 28% compared to the first six months of last year.

Meanwhile, the total value of card payments for six months reached 58.3 billion lek, an increase of 21% compared to the same period last year.

Central Bank statistics show a significant improvement in the Balance of Payments in the first half of this year, a factor that can largely explain the faster decline of the Euro this year. For the first 6 months of 2026, the current account deficit decreased, with a total value of 361 million euros or 40.6% less compared to the same period last year. The current account deficit for the first 6 months also marked the lowest level since 2018. The reduction in the deficit came mainly from the increase in exports of services and remittances.

The increase in foreign direct investment has also had an effect on the overall balance of payments. For the first 6 months of 2026, the total value of foreign direct investment reached 1.144 billion euros, an increase of 50% compared to the same period last year.

Also, an additional effect seems to have been exerted by the high fiscal surplus, which has reduced the supply of Lek in the market. For the 8-month period of 2026, the budget was in surplus at the value of 61.6 billion Lek, an increase of 52% compared to the same period a year earlier./ Monitor

 

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