Shekel weakens further as inflation falls

Shekel  / Photo: Shutterstock

Inflation in Israel over the past 12 months has fallen to just 0.3%, moving further away from the Bank of Israel's annual target range of 1%-3%.

The shekel is weakening again today against the dollar and against the euro, In late morning inter-bank trading the shekel-dollar exchange rate was up 0.49% at NIS 3.530/$ and up 0.63% against the euro at NIS 3.897/€.

Yesterday, the Bank of Israel set the shekel-dollar representative rate up 0.085% at NIS 3.513/$ from Friday's exchange rate before the sukkot holiday, and set the shekel-euro rate up 0.207% at 3.872/€.

Last night the Central Bureau of Statistics announced that the Consumer Price Index fell 0.2% in September. This means that inflation in Israel over the past 12 months has fallen to just 0.3%, moving further away from the Bank of Israel's annual target range of between 1% and 3%.

This raises the likelihood of an interest rate cut sooner rather than later. Earlier this month, Bank of Israel Governor Prof. Amir Yaron said that the Monetary Committee decision to keep the rate unchanged at 0.25% was not unanimous and that when the minutes were published it would be seen that there are good reasons for already cutting the rate.

Published by Globes, Israel business news - en.globes.co.il - on October 16, 2019

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

Shekel  / Photo: Shutterstock
Shekel / Photo: Shutterstock
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