Yes, you can move Folders as well as individual files in the Library.
To move a Folder and all of its contents, click on the Folder that you want to move, then click > Actions > Move.
Library Folder Tile View
You'll then select the Folder's new location from the dropdown menu.
Move Folder Window
Select the checkbox next to the item(s) that you want to move > Actions > Move. You'll then select the file's new location from the dropdown menu.
Library - List View
Library - Large Tile View