Fear of Floating" Exchange Rates in Albania Hinders Economic Growth.
The article explores the exchange rate volatility in Albania and investigates if there is a "fear of floating" present. Albania currently has a flexible exchange rate regime, allowing monetary policy to set interest rates for domestic stability while the exchange rate adjusts for external balance. The impact of exchange rate stability on growth is debated, with arguments for both flexible and stable rates. Low exchange rate volatility can reduce transaction costs for international trade and capital flows, potentially leading to higher growth.