The Bank of Israel announced on Monday that it was intervening in the foreign exchange market to mitigate the volatility of the Israeli currency, the shekel, which fell sharply after a surprise offensive over the weekend by the Palestinian Islamist movement Hamas.
By 09 GMT on Monday, the shekel was down 45.2% against the dollar at NIS 09.3 per dollar. "The Bank of Israel announces a program to sell up to $92 billion" in order to "moderate volatility on the shekel exchange rate and provide the liquidity necessary for the proper functioning of the market," the Israeli monetary institute said in a statement. The latter also says it is setting up "a derivatives swap mechanism for up to $30 billion", again to bring liquidity to the market, and stands ready to act with "the tools available".
The Israeli army on Monday battles Palestinian fighters infiltrated into the south of the country around the Gaza Strip, on the third day of a surprise and massive offensive launched by Hamas, compared by Israel to September 11, 2001. The war has already claimed more than 1,100 lives on both sides.