A real depreciation of the Lek against the Euro makes exports more competitive abroad and imports less competitive domestically, thus increasing the demand for domestically produced goods. The exchange rate affects the real economy more directly through changes in the demand for exports and imports. How does the exchange rate affect the economy? It is a major risk to consider for exporters/importers and businesses trading in international markets. ![]() In broad terms, exchange rate risk is major when a company or investment relies on a foreign currency that must be converted into the Albanian lek.įoreign exchange risk can be caused by the appreciation/devaluation of the Lek, the appreciation/devaluation of foreign currency (Euro, Dollar, Pound, Franc), or a combination of both.
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