The shekel strengthened against the dollar and euro in inter-bank trading this morning. The shekel-dollar exchange rate fell 0.9% to NIS 3.24/$ and the shekel-euro exchange rate fell 1.4% to NIS 5.06/€.
The euro has been weakening in international markets since European Central Bank President Jean Claude Trichet gave a speech which investors interpret to mean that no further interest rate hike is likely in the near future.
Union Bank said that the freezing of the US Fed rate and expectations that the euro rate will follow suit, and the weak dollar, suggests that Governor of the Bank of Israel Prof. Stanley Fischer will not raise the interest rate at the end of July, but will wait until next month.
Yesterday, the Central Bureau of Statistics published salary figures for April, which showed that the average gross national salary fell by 1.6%, or NIS 131, compared with March to NIS 8,056. The average salary rose by 1.3% during the first quarter, and by an annualized 1.9% in February-April.
Friday's shekel-dollar representative exchange rate was set at NIS 3.273, 0.61% higher than the day before, and the shekel-euro representative exchange rate was set at NIS 5.139, down 0.51%.
Easy Forex notes the shekel's depreciation against the dollar and appreciation against the euro on Friday. However, the shekel's general appreciation against the dollar has not ended, and if the shekel-dollar exchange rate breaks through the NIS 3.23/$ support level, it could plummet considerably.
Published by Globes [online], Israel business news - www.globes-online.com - on July 7, 2008
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