Shekel gains ahead of September CPI reading

Shekel Photo: ASAP Creative

Inflation in the US is currently at 5.4% annually while in Israel it is just over 2%.

The shekel is strengthening in afternoon inter-bank trading today. The shekel-dollar rate is down 0.44% against the dollar at NIS 3.221/$ and down 0.03% against the euro at NIS 3.739/€.

Yesterday, the Bank of Israel set the representative shekel-dollar rate up 0.279% from Tuesday, at NIS 3.235/$, and the representative shekel-euro rate was set 0.341% lower at NIS 3.741/€.

Tomorrow the Central Bureau of Statistics will announce the Consumer Price Index (CPI) reading for September with analysts expecting only a 0.1% rise due to seasonal rises in food prices. The Bank of Israel says it has no inflation concerns, and predicts 2.5% inflation in Israel this year, falling to 1.6% in 2022. These figures are far higher than for many year but both comfortably within the Bank of Israel's target range of 1%-3%.

In contrast US inflation is running at a 13-year high of 5.4% annually due to supply chain disruptions and prices are rising similarly in Europe. Israeli economists have noted that the strength of the shekel has been partly insulating Israel against inflation because commodities like oil are priced in dollars.

Published by Globes, Israel business news - en.globes.co.il - on October 14, 2021

Copyright of Globes Publisher Itonut (1983) Ltd. 2021

Shekel Photo: ASAP Creative
Shekel Photo: ASAP Creative
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