An Unprecedented Year for the Dinar Against the Dollar and the Euro in Banks
The Algerian currency’s gains have decreased relatively in official dealings against the euro, after it achieved a remarkable rise in recent months, while its performance against the US dollar is still improving. Still, in general, the dinar is heading towards recording an unprecedented year in its exchange rate with banks that have not been achieved in 10 years at least.
In this context, the data of the Bank of Algeria related to the exchange rate of the dinar against foreign currencies until December 21, 2022, shows that its value against 100 euro amounted to 14.592.00 dinars for purchase, and 14.599.09 for sale.
Looking at these data, it is clear that the national currency had declined in recent weeks against the euro, after making remarkable gains in the past few months, when the price of 1 euro reached less than 140 dinars, down from 157 dinars at the beginning of this year.
Despite this “decline” in the exchange rate of the national currency against the euro in recent weeks, the dinar has made gains on an annual basis with the euro, currently amounting to about 120 dinars/1 euro, given that the first months of the year witnessed the exchange rate reaching 157 dinars/1 euro, and that the current year is only 11 days away from its end.
This slight decline in the performance of the dinar against the euro in banks coincided with the recovery of the single European currency in recent weeks and its restoration of some of its strength against the US dollar so that the exchange of 1 euro amounts to 1.06 US dollars in the current period after it had surpassed the euro in the past months.
As for the exchange rate of the Algerian currency against the US dollar for the same period, it reached, according to the data of the Bank of Algeria, 137.2848 for purchase, and 137.2998 for sale.
Given what was included in the current Finance Law (2022), the national currency tends to close the year with a positive difference of 12 dinars against the dollar, based on the premise that the same law set the closing price for the year 2022, which it set at 149 dinars per 1 dollar, which, if it happens, will be a precedent at least in the last ten years, as previous governments resorted to adopting a policy of devaluing the dinar every year, to obtain greater financial returns against the dollar.
According to observers, this recovery in the exchange rate of the national currency with banks against the euro and the dollar is due to the improvement recorded in four major indicators that are the basis for assessing the level of the Algerian dinar, similar to the competitiveness of the Algerian economy compared to other economies, and energy prices, which reached a higher value of the Algerian currency with an improvement of performance in the balance of payments, in addition to the growth of the national economy through the gross domestic product and the performance of the economy in general.
