Inflation rose in February, reaching the highest level in the last seven months.
According to data from INSTAT, inflation reached 2.5%, up from 2.3% in January. Inflation has also marked a significant increase compared to the same period a year ago, when it was 1.9%.
The annual price increase in February 2026 was mainly influenced by the group "Rent, water, electricity, gas and other fuels" by 5.3%, followed by "Insurance and financial services" by 4.3%, "Entertainment, sports and culture" by 4.2%, "Restaurants and accommodation services" by 2.4%, "Personal care and miscellaneous goods and services" by 2.3%, "Alcoholic beverages and tobacco" and "Furniture, household equipment and home maintenance" by 2.2% each, "Educational services" by 1.9%, "Food and non-alcoholic beverages" by 1.7%.
According to the contribution to inflation, the annual price increase in February was mainly influenced by the group "Rent, water, electricity, gas and other fuels" with +1.06 percentage points, followed by the group "Food and non-alcoholic beverages" with +0.60 percentage points.
Also, the prices of the group "Furniture, home furnishings and home maintenance" by + 0.15 percentage points, the prices of the group "Restaurants and accommodation services" by +0.13 percentage points, the prices of the group "Alcoholic beverages and tobacco" by +0.11 percentage points, the prices of the group "Personal care and various goods and services" by +0.10 percentage points, the prices of the group "Entertainment, sports and culture" by +0.08 percentage points, the prices of the groups "Educational services" and "Insurance and financial services" by +0.06 percentage points each, the prices of the groups "Transport" and "Information and communication" by +0.03 percentage points each, the prices of the groups "Clothing and footwear" and "Health" by +0.02 percentage points each.
In its inflation projections, the Bank of Albania has predicted a return to near the 3% target in the first half of this year.
However, the war in the Middle East and the rapid increase in oil prices are bringing new scenarios for inflation. If the increase in oil prices is sustainable, an increase in inflation in the coming months will be inevitable. New developments are expected to bring a revision of inflation projections, but also a new course of monetary policy.
Currently, the base interest rate in Albania is at 2.5%, but new inflationary scenarios may bring an increase in interest rates faster than expected./Monitor
