Shekel against dollar: is the trend going to reverse and the shekel will rise again?
At least according to Bloomberg, the answer is unequivocal (Photo: Reuven Castro)
Those looking for a bit of good news concerning the Israeli economy may receive it from a surprising source: the Bloomberg news agency estimates that the Israeli shekel is the best investment for foreign currencies (that is, in the global basket of currencies) for 2023. Although Bloomberg does not ignore the political tensions, which may endanger Israel's
economy , but note, for example, the good response of the shekel (and the stock exchange) in Tel Aviv to the president's assessment that a compromise on the reform issue is closer than ever, as it was two days ago.
What else is Bloomberg's forecast based on?
On Israel's gas reserves and natural gas exports from it, which has increased sharply and is expected to increase further as the amount of gas purchased by European countries from Russia decreases (due to the sanctions imposed on it for the invasion of Ukraine) as well as on the traditional behavior of the shekel.
What do you mean by traditional conduct?
To the fact that the shekel tends to weaken in the winter months, but strengthens in the spring - and rises from around April, as the months of the year progress.
How much will the shekel strengthen?
According to the estimate - at 9% until the end of 2023, a fantastic (potential, it must be emphasized) return in view of the performance of the capital market and the decline in the real estate market in the world. The analysis also
refers to the fact that American investors will look for avenues of investment outside the USA, in view of the weak performance relative to the capital markets in the world.
They note the difficulty for high-tech companies to raise funds through the capital market, but do not rule out the possibility that investor funds will be transferred directly to companies that are portrayed as promising.
The agency even notes the policy of the Bank of Israel and notes that so far it has not artificially supported the stabilization of the exchange rate, even in view of its decline against the dollar and other currencies.
Those who wish to be even more optimistic can see this as evidence of Bloomberg's assessment that the political crisis in Israel will not develop into a constitutional crisis and will end in a compromise that will project positively on the exchange rate.
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