The dollar has strengthened since Tuesday morning against the dollar, mainly due to the strengthening of the dollar worldwide. It rose 0.4% to trade at NIS 3.8460. It should be noted that on weekdays, trading in the foreign exchange market is thinner, which may cause higher volatility in currency rates.
The dollar strengthens against the shekel, illustration, photo: GettyImages
Yossi Freiman, CEO of Frico Risk Management, Finance and Investments, warns of further weakening of the shekel. "Against the background of the High Court hearings and the reduction of foreign activity, the potential for shekel appreciation is limited. A breach of the NIS 3.86-3.88 range will signal movement towards NIS <> per dollar. The depreciation of the shekel and a further rise in exchange rates will lead to an increase in the shekel interest rate as a preventive measure to reduce inflationary pressures."
"Expecting a tough report from Moody's"
"The dollar is strengthening today against the shekel, both due to the strengthening of the dollar worldwide and against the background of local events. On the local level, it is likely that there is an impact on security reports from the Gaza and Lebanese sectors," Ronen Menachem, chief market economist at Mizrahi-Tefahot, told Israel Hayom.
"These reports, which joined the escalation in the Jenin area, come against the background of already high security tensions during Chol Hamoed," he said.
Expecting a report is difficult. Moody's Credit Rating Agency, Photo: Reuters
Hints at US interest rate hikes
Menachem explains that it is possible that the expectation of a "difficult report," in Moody's words, which is due to be published soon, is adding to the pressure in the foreign exchange market. Regarding the international arena, Menachem notes that "the dollar has recently strengthened against most other currencies in the world, including the shekel, because of the expectation of high and prolonged interest rates in the US (Fed officials hint at this) and also because of global risk aversion (against the background of declines in equity markets around the world and geopolitical tensions) that strengthens the dollar as a safe foreign currency – as mentioned against the shekel as well."
In conclusion, Menachem notes: "With all this, there is still no deviation from the range of 3.80-3.85 that the shekel-dollar has been moving in for some time."
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