Shekel weakens as WGBI bond boost fades

Shekel  / Photo: Shutterstock

Israel's inclusion on the World Government Bond Index could translate to foreign currency purchases in shekels of government bonds worth about $2 billion.

The shekel is weakening today against the dollar and against the euro. In early afternoon inter-bank trading, the shekel-dollar exchange rate is up 0.29% against the dollar at NIS 3.495/$ and up 0.63% against the euro at 3.829/€.

Yesterday, the Bank of Israel set the shekel-dollar representative rate up 0.086% at NIS 3.485/$ from Friday before the Rosh Hashana holiday, and set the shekel-euro rate down 0.003% at 3.805/€.

The shekel continues to weaken after its strong gains at the end of last week after FTSE Russell has announced that Israel government bonds are to be included on the World Government Bond Index (WGBI) from April 2020. Bank Leumi chief economist Gil Buffman and other analysts see Israel's 0.29% weight in the index translating to foreign currency purchases in shekels of government bonds worth about $2 billion - purchases that will be sure to strengthen the Israeli currency from next April onwards.

Published by Globes, Israel business news - en.globes.co.il - on October 3, 2019

© Copyright of Globes Publisher Itonut (1983) Ltd. 2019

Shekel  / Photo: Shutterstock
Shekel / Photo: Shutterstock
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