With annual inflation at 0.8%, near the government target of 1%-3%, there is growing confidence that the Bank of Israel will be able to raise rates in the final quarter of the year.
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 0.34% against the dollar at NIS 3.632/$ and down 0.27% against the euro at 4.198/€.
Yesterday, the Bank of Israel set the shekel-dollar representative rate up 0.496% from Monday's exchange rate at NIS 3.644/$ and set the shekel-euro rate down 0.062% at 4.209/€.
As US-China trade war fears ease slightly, the dollar has taken a breather from 11-month highs against most major currencies earlier this week.
The Israeli economy remains robust with annual GDP growth of over 4% and with annual inflation at 0.8%, near the government target of 1%-3%, there is growing confidence that the Bank of Israel will be able to raise interest rates above the historic low of 0.1% in the final quarter of the year.
Published by Globes [online], Israel business news - www.globes-online.com - on June 20, 2018
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