"The foreign currency market continues to stand still. Nothing is moving the shekel-dollar exchange rate, not rallies in global markets, the weakness of the dollar in international trading, nor the hints by [Governor of the Bank of Israel Stanley] Fischer. All these factors appear to balance each other out," says FXCM Israel today.
"In view of Fischer's muscle flexing against the market in his remarks at the conference in the Czech Republic that the Bank of Israel could intervene in foreign currency trading forever. It will be interesting to see whether the market will understand the message and we will see the start of an upward correction," added FXCM.
"The fact that the shekel has not been able to strengthen against the dollar, despite the greenback's weakness in the world, may indicate that Fischer's remarks had an effect on trading. On the other, a plunge to a new low, at around NIS 3.65/$, will put Fischer's remarks to the test and may cause the Bank of Israel to intervene or to speak out more forcibly.
"The shekel-dollar exchange rate is still treading water at NIS 3.66-3.70/$, and only a breakthrough in either direction will make it possible to assess the next move by the exchange rate," concludes FXCM.
Published by Globes [online], Israel business news - www.globes-online.com - on February 13, 2013
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