The shekel continues to strengthen sharply against the dollar and against the euro. In early afternoon inter-bank trading, the shekel-dollar exchange rate is down 0.80% from yesterday's representative rate at NIS 3.493/$, and down 1.27% against the euro at 4.315/€.
Yesterday, the Bank of Israel set the shekel-dollar representative rate up 0.083% from Friday's exchange rate at NIS 3.527/$ and set the shekel-euro rate up 0.694% at 4.353/€.
Prico Risk Management and Investments CEO Yossi Fraiman said, "The outside 'market maker' recently hired by the Bank of Israel took a day off for US Presidents Day and the balloon burst - the shekel-dollar rate dropped without external support. The swiftness of the fall from NIS 3.55/$ to NIS 3.51/$ teaches us that without the intervention of the Bank of Israel, the exchange rate will return to NIS 3.40/$ very quickly and proves again the ongoing involvement and intervention of the Bank of Israel in trading."
Fraiman adds, "The fall in the Consumer Price Index in January, among other things, has influenced the continuing appreciation and supports the Bank of Israel's intervention in the medium term until there is inflationary pressures and a rise in prices. The artificial devaluation creates a comfortable environment for dollar oriented high-tech activities alongside the normal track and an escape from encouraging slowdown and unemployment."
The battle by the responsible adults, the Bank of Israel and Ministry of Finance, to break through the key exchange rate level of NIS 3.55-3.65/$ can be expected in the coming months. So far three attempts to do this have failed."
Published by Globes [online], Israel business news - www.globes-online.com - on February 20, 2018
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