The shekel has strengthened against the major currencies this morning. The shekel-dollar exchange rate is currently down 0.22% in comparison with Friday's representative rate, at NIS 3.8805/$, and the shekel-euro rate is down 0.54%, at NIS 4.1063/€, a near 14-year low.
On world markets, the euro has weakened by about 0.1% against the dollar to $1.05/€. The European currency has weakened by about 4% against the US dollar over the past month, and by more than 12% so far this year. This is against a background of speculation that the European Central Bank will announce a quantitative easing program amounting to €60 billion monthly.
In the US, on the other hand, the Federal Reserve is expected to move in the opposite direction and raise its interest rate in December. This weak, US employment figures for November will be released. The market expects that if the figures are positive, this will represent final confirmation for the Federal Reserve that an interest rate hike is due.
FXCM Israel says in its market review this morning, "At the opening of a trading week crowded with key events, we continue to see a split between the behavior of the dollar on world markets and its behavior on the local market. While the global dollar index is at an eight-month high, above the key 100 level, the shekel-dollar exchange rate continues to mark time in the NIS 3.85-3.90/$ range, and is not managing to break through the NIS 3.90/$ barrier. At the same time, the assessment is that this is a technical hurdle that does not derive from any fundamental strength of the shekel. The more we see the dollar strengthening on world markets, the more successful speculators in Israel will be in pushing the shekel-dollar rate to break through upwards."
Published by Globes [online], Israel business news - www.globes-online.com - on November 30, 2015
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