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Euro's decline deepens/ Experts: Approaching parliamentary elections are weakening the currency

Politiko 2025-03-24 15:56:39

Euro's decline deepens/ Experts: Approaching parliamentary elections are

The European currency continues to lose ground, trading at 98.96 lekë according to data from the Bank of Albania.

It is tourism, remittances, but also the approaching parliamentary elections, according to experts, that are further weakening this currency.

" We see that February and March, with the warming of temperatures, have also brought the depreciation of the euro due to the increase in the number of tourists visiting Albania. The second phenomenon is the increase in remittances, which have recently brought emigrants more money these months, directly affecting the euro. We have seen that foreign direct investments are at the highest levels in real estate and the latter have transactions in euros ," says Romina Radonšić, an economic expert, for TCH.

The effect of the euro depreciation has brought losses in state budget revenues. 160 million euros less was recorded from VAT on imports in 2024. While exporters have also had less profits. But on the other hand, this situation is significantly favoring external debt.

"Second-tier banks are giving out fewer loans in euros to manage risk. But the main winner is the government because of the external debt it has in euros and the income it has in lek, when converted into euros it has the opportunity to pay off this external debt," the economic expert further adds.

Other major currencies are also on a downward trend. The US dollar is trading at 91.36 lek, the British pound at 118.15 lek and the Swiss franc at 103.61 lek./TCH

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