The shekel was weakening in late morning inter-bank trading today against the dollar and against the euro. The shekel-dollar exchange rate is up 0.42% at NIS 3.88/$ compared with yesterday's representative rate, and the shekel-euro rate is up 0.40% at NIS 4.353/€.
Yesterday, the Bank of Israel set the shekel-dollar representative rate down 0.258% from Monday's rate at NIS 3.864/$, and the representative shekel-euro rate was set down 0.730% at NIS 4.335/€.
FXCM Israel said in its morning survey, "The shekel-dollar exchange rate continues to climb towards NIS 3.875/$, its highest rate since May 23. Rising above NIS 3.88/$ could pave the way towards the higher limit of NIS 3.90/$ in its current trading band. Despite low interest rate expectations on the dollar, the US currency has been strengthening against the shekel due to demand for safe haven currencies ahead of the UK's referendum next week on leaving the EU. The referendum could shake up the markets if British voters elect to leave the EU and consequently investors are in cautious mood and reducing exposure to riskier assets such as shares, oil and exotic currencies like the shekel.
"The referendum and polls indicating a lead for those advocating that Britain leave the EU, cast a shadow over the US Fed's meeting this evening, which is expected to leave the interest rate unchanged. This follows disappointing job data published at the beginning of the month. The Fed had wanted to implement four interest rate hikes in 2016 but its plans have been spoiled by the fall in oil prices, economic slowdown in China, problems in the Euro bloc, and then the bad job figures."
Published by Globes [online], Israel business news - www.globes-online.com - on June 15, 2016
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