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The shekel continues to strengthen: the dollar is below NIS 3.1, the euro is NIS 3.48 Israel today

2021-11-17T10:11:09.408Z


Trading opened this morning with a clear trend of high demand for the shekel against the dollar and the euro, and the Bank of Israel began to intervene in trade to inject tens of millions of dollars in demand. The shekel


The dollar exchange rate reached a 25-year low yesterday, when it fell below NIS 3.1 yesterday.

This morning (Wednesday) trading opened with a clear trend of high demand for the shekel against the dollar and the euro, and the Bank of Israel began to inflow demand of tens of millions of dollars.

As of the time of writing, the dollar is trading at NIS 3.08 and the euro is trading at NIS 3.48.

This action by the Bank of Israel comes after in recent days it also allowed the euro to fall sharply against the shekel, and it traded yesterday at a rate of NIS 3,511 per euro.

So far, the Bank of Israel has refrained from interfering in the market and the Governor of the Bank of Israel, Prof. Yaron Amir, continues to be vague about the Bank's intervention in trade.

Yesterday it was revealed in "Israel Today" that the Minister of Finance will publish in the coming days a package of measures to encourage exporters, in order to compensate exporters a little for the strengthening of the shekel.

As is well known, the Treasury works in full coordination with the Bank of Israel, so it seems that the Treasury's decision indicates that the Bank of Israel has indeed decided to allow the shekel to continue strengthening against the two currencies.

The Tel Aviv Stock Exchange, Photo: Gideon Markovich

In the past year, the shekel has strengthened more than 10% against the dollar. According to Prof. Yaron, "the market picture is completely different now and the strengthening shekel may slightly curb world inflation." The Bank of Israel prefers to see rising inflation in the world, and also in Israel, as a temporary situation and therefore they do not react to it in the way we have known in the past. Inflation in the US has reached 6.2% and in Israel it now stands at 2.6% - close to the upper target range - 1% -3%. Market conduct now, without the intervention of the Bank of Israel, may continue to strengthen the shekel against the dollar and the euro. Foreign exchange here dictates high demand for the shekel, while the level of demand for dollars and euros from Israelis has fallen.

More than a month ago, the Bank of Israel completed its $ 30 billion foreign exchange purchase program, accumulating foreign exchange reserves in excess of $ 210 billion.

These are exceptional balances compared to what is customary in the developed countries of the world, amounting to 40% of GDP.

The market is now waiting anxiously for trading today, during which it will become clear how much the bank is willing to stay out of the foreign exchange field as it continues to lose ground against the shekel.

Source: israelhayom

All news articles on 2021-11-17

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