For the first time since December 2012, the Bank of Israel has set the shekel-dollar representative exchange rate above 3.80/$. The Bank of Israel this afternoon set the rate at NIS 3.80/$, up 0.105% on yesterday's rate, and set the shekel-euro representative exchange rate at NIS 4.74/€, down 0.217%.
However, in late afternoon inter-bank trading after the new rate was set the shekel-dollar rate was down 0.03% at 3.799, and the shekel-euro rate was up 0.20% at NIS 4.7495/€.
FXCM Israel Research Department sees a positive correlation between global risk sentiment and the value of the dollar, in contrast to the opposite correlation in recent years between the dollar and risk assets. Thus when Wall Street falls, the dollar weakens as has happened over the past few days.
FXCM said, "A fall in the shekel-dollar exchange rate below NIS 3.78/$ might prod some traders into realizing long position profits thus accelerating the fall. On the other hand, breaking through the NIS 3.80 threshold will again strengthen the momentum towards NIS 3.815/$."
Published by Globes [online], Israel business news - www.globes-online.com - on November 5, 2014
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