The shekel is weakening today against the dollar and strengthening against the euro. In afternoon inter-bank trading the shekel-dollar exchange rate is up 0.58% at NIS 3.381/$ and down 0.15% against the euro at NIS 3.990/€.
Yesterday, the Bank of Israel set the shekel 0.474% down from Friday at NIS 3.361/$, and the representative shekel-euro rate was set 0.177% lower at NIS 3.996/€.
The shekel was trading yesterday at its strongest rate against the dollar since July 2008, after returning to its strong trading levels before the second lockdown in September, as the country gradually reopens.
But today the shekel has corrected against the dollar, although it remains unclear whether this was due to the Bank of Israel's intervention to buy foreign currency. Between May and August, the Bank of Israel purchased $7.5 billion in foreign currency to weaken the shekel but over the past two months those purchases have fallen to just $880 million.
In recent days, international stock markets have been lifted by the 'Biden bounce' and yesterday's very positive results from the Pfizer Covid-19 vaccine trial. This means that Israeli investment institutions, which have been selling shekels and buying dollars to support their overseas positions in recent bear markets, are now purchasing shekels back and thus strengthening the Israeli currency.
Published by Globes, Israel business news - en.globes.co.il - on November 10, 2020
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