Global weakness in the dollar, Wall Street gains and an expected rate hike next week in Israel are also strengthening the shekel.
The shekel is strengthening today against the dollar and against the euro. In early afternoon inter-bank trading, the shekel exchange rate is down 0.47% against the dollar at NIS 3.419/$ and down 0.49% against the euro at NIS 3.562/€.
Yesterday, the Bank of Israel set the representative shekel-dollar rate down 0.087% from yesterday, at NIS 3.435/$, and the representative shekel-euro rate was set 1.336% higher at NIS 3.580/€.
Israel’s economy grew at 2.1% in Q3
Israel’s annual inflation rate rises above 5%
The shekel is trading at its strongest against the dollar since the start of September. The shekel is benefitting from the global weakness of the US currency as well as Wall Street gains, which compel Israeli institutional investors to buy shekels to hedge their overseas portfolios.
In addition the Bank of Israel is expected to raise the interest rate at its meeting next Monday. Last month the Bank of Israel Monetary Committee raised the interest rate by 0.75% to 2.75%, which was the fifth rate hike made by the Bank of Israel since April, when it raised the rate from its historical low of 0.1% to 0.35%. Analysts are split over whether next week’s hike will be 0.5% or 0.75%, with yesterday’s slightly higher than expected October CPI reading supporting the bigger hike.
Published by Globes, Israel business news – en.globes.co.il – on November 16, 2022.
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Shekel credit: Shutterstock Vladirina 32