After its sharp depreciation last week, the shekel has been strengthening today against the dollar and against the euro. In afternoon inter-bank trading, the shekel-dollar exchange rate is down 0.57% at 3.709/$ and the shekel-euro rate is down 0.40% at NIS 3.983/€.
Last Thursday, before the Shavuot holiday and the US Memorial Day holiday yesterday, the Bank of Israel set the representative shekel-dollar rate down 0.027% at NIS 3.730/$, and the representative shekel-euro rate was set 0.331% lower at NIS 3.999/€.
The shekel is trading against the dollar at levels not since the start of the Covid pandemic in March 2020. Several factors could have caused the strengthening of the shekel today including a positive report from Fitch, which even said that Israel's credit rating could be raised if the government jettisons its judicial overhaul plans.
In addition, Governor of the Bank of Israel Prof. Amir Yaron told the Eli Hurvitz Economic Conference yesterday that more monetary restraint will be necessary if the shekel continues to depreciate - in other words a further rate hike.
Published by Globes, Israel business news - en.globes.co.il - on May 30, 2023.
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