Albanian Lek and the US Dollar
This can be a good time to visit Albania.
In the late part of September 2009, the Albania Lek (ALL) has lost some 3 per cent against major currencies like the US Dollar. And while this information is good for tourist, Albanians are left with worry and panic on whether they themselves should switch their savings into the US Dollar or the Euro.
Currently, 1 UD Dollar (USD) is trading at 93 Albania Lek (Leke/ALL). Compared to just 2 weeks ago on 15th Sep 2009, 1 USD is trading was trading at about 91 Albania Lek. Albanians are now worrying if the trend of Albanian Leke (ALL) depreciation will continue.
The worst case scenario can happen when the Albanians themselves decide to switch to a more stable foreign currency as a store of their wealth. Primarily, the US Dollar is well poised to step in, with the currency readily available to the Albanians. When such panic happens, the Albanian Leke may will disappear entirely, with the country then switching to the Euro bandwagon (Albania is after all in Europe). This will be preceded by a free-fall in the value of Albanian Leke, before the Albanian Central Bank has enough time to react by using their foreign reserves to buy into the Albanian Leke.
Even if the worst case scenario does not happen, it is hard to foresee how the Albanian Leke can stop its depreciation. It is true that the depreciation of the Albanian Leke (ALL) now may be more of a speculation without any economic basis. However, it is equally true that the Albanian Leke is currently deemed fragile – the European nations are now watching if there will be another country that will adopt the Euro pretty soon. For now, tourist to Albania are smiling as they have the best exchange rate of Albanian Leke (ALL).
