The shekel is strengthening today against the dollar and stable against the euro. In late morning inter-bank trading, the shekel-dollar exchange rate is down 0.44% against the dollar at NIS 3.626/$ and down 0.05% against the euro at 4.168/€.
Yesterday, the Bank of Israel set the shekel-dollar representative rate up 0.608% at NIS 3.642/$ from Monday's rate and set the shekel-euro rate up 0.373% at 4.170/€.
The dollar is weaker on global forex markets, down from a 7-week high after a fall in US bond yields.
For its part, the shekel has rebounded after weakening yesterday following the Bank of Israel Monetary Committee's decision on Monday to keep the interest rate unchanged at 0.1%. It was the last meeting under Governor Karnit Flug whose five year term ends next month. She will be replaced by Prof. Amir Yaron, a banking and finance specialist, from the University of Pennsylvania's Wharton School.
One of Prof. Yaron's first tasks will be to consider if and when to raise the interest rate, which has been rooted at its historic low of 0.1% since March 2015. The interest rate between the shekel and the dollar is widening, with the Fed hiking the rate this month, and expected to do so again in December.
However, many analysts do not see an Israeli rate rise this year. Goldman Sachs sees the Bank of Israel raising the interest rate in the first quarter of 2019 and not before because inflation in Israel in 2018 is expected to be only 0.9%, below the government's annual target range of 1%-3%.
Published by Globes [online], Israel business news - en.globes.co.il - on October 10, 2018
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