Shekel stronger ahead of December CPI reading

Shekel Photo: ASAP Creative

Analysts forecast that the December Consumer Price Index rose 0.1%, leaving inflation in 2019, well below the 1%-3% target range.

The shekel is strengthening today against the dollar and against the euro. In late morning inter-bank trading the shekel-dollar exchange rate is down 0.26% at NIS 3.461/$ and down 0.29% against the euro at NIS 3.850/€.

Yesterday, the Bank of Israel set the representative shekel-dollar rate unchanged from Monday at NIS 3.470/$, and the representative shekel-euro rate was set up 0.039% at NIS 3.861/€.

The shekel is strengthening today ahead of publication this evening of the December Consumer Price Index (CPI) for December. Analysts forecast a rise of 0.1% for December, meaning that inflation would have been 0.6% in 2019, still below the Bank of Israel's annual target range of 1%-3%.

The shekel continues to strengthen despite the best efforts by the Bank of Israel to weaken the Israeli currency by purchasing large amounts of foreign currency. This not only helps exporters but also pushes inflation towards the annual target range. The Bank of Israel has blamed low-inflation on the strength of the shekel, which reduces prices on imported goods and services including oil.

Published by Globes, Israel business news - en.globes.co.il - on January 15, 2020

© Copyright of Globes Publisher Itonut (1983) Ltd. 2020

Shekel Photo: ASAP Creative
Shekel Photo: ASAP Creative
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