The shekel is strengthening today against the dollar and against the euro. In early afternoon inter-bank trading the shekel-dollar exchange rate is down 0.47% at NIS 3.506/$ and down 0.80% against the euro at NIS 3.901/€.
Yesterday, the Bank of Israel set the shekel-dollar representative rate up 0.028% at NIS 3.522/$ from Friday's exchange rate, and set the shekel-euro rate up 0.158% at 3.933/€.
The shekel is strengthening today after the US Federal Reserve cut the dollar interest rate last week for the third time since July, although at 1.5%-1.75%, it is still well above the shekel interest rate of 0.25%.
The US economy is slowing but Leader Capital Markets macroeconomist Yonatan Katz expects Israeli GDP growth of 3% on an annualized basis in the third quarter of 2019. Katz does not anticipate that the Bank of Israel will cut the interest rate this month due to the expected high Consumer Price Index (CPI) reading for October.
Katz adds that capital movements and a current account surplus support a continued appreciation of the shekel.
Published by Globes, Israel business news - en.globes.co.il - on November 5, 2019
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