Albania Keeps Key Policy Rate at 2.5%

The Bank of Albania kept its policy rate unchanged at 2.5% on March 2026, marking the fifth consecutive pause. The overnight lending and deposit rates were also held steady at 3.5% and 1.5%, respectively. Consumer price inflation averaged 2.4% in January and February, below the target of 3%, with inflationary pressures contained in rent prices. The economy expanded 3.7% over the past year, supported by growth in household spending, private investment and export of services. The unemployment rate in Q4 2025 stood at 8.3%, remaining close to its historical lows. However, the labor market remains under tension, driven by high demand in business and weak supply of workers. The Council stated overall developments in recent months have been in line with expectations and reflect a positive growth trend. However, it also highlighted rising uncertainty stemming from ongoing geopolitical tensions, warning that potential supply shocks could pose risks to inflation and future economic growth.