Shekel opens weaker

The shekel is losing ground against the dollar and euro ahead of the Bank of Israel's interest rate decision this evening.

The shekel has weakened against the dollar and euro in morning inter-bank trading today, ahead of the Bank of Israel's interest rate decision for November. The shekel-dollar exchange rate has risen 0.30%, compared with Friday's representative rate, to NIS 3.537/$ and the shekel-euro exchange rate has risen 0.26% to NIS 4.883/€.

On Friday, the Bank of Israel set the shekel-dollar representative exchange rate at NIS 3.526/$, down 0.17% on the day before, and the set the shekel-euro representative exchange rate at NIS 4.871/€, down 0.07%.

In international markets, the dollar is flat against the euro, traded at $1.380/€, weakened slightly against the pound to $1.618/£, and strengthened against the yen to ¥97.61/$.

FXCM Israel said today, "If the Fed uses rhetoric that signals a tapering [of quantitative easing], the market will respond negatively, but the Fed will probably reiterate its usual rhetoric which conditions any change in policy on an improvement in the economy, this will support the conventional wisdom that the tapering will be deferred until the first half of 2014. This will increase the pressure on the shekel-dollar exchange rate. On the other hand, if the Fed adopts tougher rhetoric and signals a possible tapering, the market will have to reassess and the dollar may recover. Any surprise by the Fed could signal a correction.

Published by Globes [online], Israel business news - - on October 28, 2013

© Copyright of Globes Publisher Itonut (1983) Ltd. 2013

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