Shekel opens December with gains

Shekels Photo: Shutterstock Vladerina32

The shekel has opened December with gains after losing nearly 1% against the dollar in November and gaining 2% against the dollar in October.

The shekel is strengthening against the dollar and euro today. In afternoon inter-bank trading, the shekel exchange rate is down 0.42% against the dollar at NIS 3.149/$ and down 0.64% against the euro at NIS 3.567/€.

Yesterday, the Bank of Israel set the representative shekel-dollar rate up 0.158% from Monday, at NIS 3.162/$, and the representative shekel-euro rate was set 0.744% higher at NIS 3.590/€.

The shekel has opened December with gains after losing nearly 1% against the dollar in November and gaining 2% against the dollar in October.

Forex trading has been volatile in the past week and a half. After strengthening against all the world's major currencies on expectations of a rate hike sooner rather than later, the turning point came on Monday last week, when the Bank of Israel Monetary Committee announced it was keeping the interest rate unchanged at its historic low of 0.1%. The unexpectedly low Consumer Price Index rise of 0.1% in October meant that while central banks around the world have had to act to restrain inflation, the Bank of Israel can afford to wait, and expectations of a rate hike receded, thus weakening the shekel.

There have also been reports of aggressive foreign currency purchases by the Bank of Israel to intensify the trend. The falls on foreign stock exchanges, on concerns about the new Covid Omicron variant, have also weakened the shekel as Israeli institutional investors buy foreign currency to hedge their overseas holdings.

Published by Globes, Israel business news - en.globes.co.il - on December 1, 2021.

© Copyright of Globes Publisher Itonut (1983) Ltd., 2021.

Shekels Photo: Shutterstock Vladerina32
Shekels Photo: Shutterstock Vladerina32
Twitter Facebook Linkedin RSS Newsletters גלובס Israel Business Conference 2018