After depreciating sharply yesterday, the shekel is gaining strongly today against the US dollar and the euro. In late morning inter-bank trading, the shekel-dollar rate is 1.01% lower at NIS 3.685/$ and the shekel-euro rate is 0.63% lower, at NIS 4.087/€.
Yesterday, the Bank of Israel set the representative shekel-dollar rate up 1.389% from Tuesday, at NIS 3.722/$, and the representative shekel-euro rate was set 1.498% higher at NIS 4.113/€.
Despite strengthening today, the shekel has still weakened 0.7% against the dollar this week. Poria Financial Planning chairman Or Poria says that there are two factors for the depreciation of the shekel against the dollar. "First, the sharp declines on the markets on Tuesday created pressure on the Israeli currency and led to the strengthening of the dollar, which is considered a safe haven currency in situations of uncertainty. Second, from the local angle, the lack of progress in forming a hostage deal and the continued fighting in our region add to the weakness of the shekel, which suffers from the economic and political uncertainty in Israel".
However, he added, "Due to our belief that the shekel will strengthen against the dollar in the long term, we see any increase in the dollar exchange rate as an opportunity to sell and buy the shekel."
Published by Globes, Israel business news - en.globes.co.il - on September 5, 2024.
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