Senior strategist Koon Chow says that good economic fundamentals in Israel and general dollar weakness continue to support his recommendation.
Barclays Capital continues to recommend a trade of buying a dollar put option, and going long on the shekel.
Barclays expects the Bank of Israel to raise interest rates by 25 basis points at the end of this month. The bank also points out that the Bank of Israel intervened again last week in the foreign currency market to limit the shekel's strength against the dollar.
Barclays senior foreign exchange strategist Koon Chow continues to recommend the trade he suggested in September, which is to buy a 3 month put option on the dollar, and a 3 month call option on the shekel, with a reverse knock-out. The exchange rate is currently about NIS 3.7/$, and Barclays expects the shekel to strengthen so that the exchange rate reaches NIS 3.5/$ in 12 months. Chow says that good economic fundamentals in Israel and general dollar weakness continue to support his recommendation.
Published by Globes [online], Israel business news - www.globes-online.com - on October 18, 2009
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