Albanian lek reaches historic high against euro ahead of Orthodox Easter

Albanian lek reaches historic high against euro ahead of Orthodox Easter
The Albanian lek rose steadily against the euro during April, peaking over the Orthodox Easter weekend, / Bank of Albania
By bne IntelliNews May 6, 2024

The Albanian lek reached an unprecedented high against the euro on the local currency exchange market, according to data from the Bank of Albania.

The euro was exchanged at ALL100.31 on May 3, the lowest level ever recorded and down by 9.7% compared to a year earlier. The lek then dropped back slightly to ALL100.54 to the euro on May 6. 

The previous record of ALL100.49 to the euro was registered in July 2023, during the peak tourist season.

The upward pressure on the lek has been linked to the Orthodox Easter holiday, when large numbers of Albanians returned to their homeland, especially from neighbouring Greece. 

Typically, the lek has been pushed up by tourists and returning Albanians buying the currency during their visits. 

Market analysis from Monitor suggests that the Albanian lek is poised for further strengthening in the coming months, with expectations that it will break through the psychological barrier of ALL100 to the euro this year.

The lek has also strengthened against other major currencies such as the US dollar, British pound and Swiss franc.

The rise of the lek over the last couple of years has made Albania's exports increasingly uncompetitive in European markets. This has been particularly damaging for the country's large textiles and footwear sector, which primarily supplies Italy's apparel industry. 

On the other hand, the strong lek made imports more affordable, which helped keep inflation levels relatively low compared to other Southeast European countries in 2022 and 2023.