Shekel strengthening ahead of BoI rate call

Shekel Photo: ASAP Creative

The Bank of Israel is not expected to change the interest rate but may provide information about its foreign currency purchasing program.

The shekel is strengthening today against the dollar and against the euro. In late morning inter-bank trading, the shekel-dollar exchange rate was down 0.20% at NIS 3.246/$ and the shekel-euro rate was down 0.27% at NIS 3.958/€.

The Bank of Israel set the representative shekel-dollar rate up 0.154% on Friday, at NIS 3.253/$, and the representative shekel-euro rate was set 0.146% higher, at NIS 3.969/€.

The shekel continues to trade at its strongest against the dollar since mid-January. This afternoon the Bank of Israel's Monetary Committee will announce the interest rate for June and it is almost certain to remain unchanged at its historic low of 0.1%.

But all eyes will be on comments about the bank's foreign currency and corporate and government bond purchasing programs, which could have a major bearing on the future direction of the shekel and the bond markets. Also of interest will be the updated forecasts from the Research Department about GDP growth, in light of the unexpected contraction in the first quarter of 2021, as well as predictions on inflation and unemployment.

Published by Globes, Israel business news - en.globes.co.il - on May 31, 2021

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

Shekel Photo: ASAP Creative
Shekel Photo: ASAP Creative
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