Shekel weakens amid US rate hike expectations

Shekels Photo: Shutterstock

FXCM Israel: With US inflation at its highest since 2014, expectations of a Fed rate hike in December are strengthening.

The shekel is weakening today against the dollar and against the euro amid growing Fed rate hike expectations and the strengthening of the dollar on global markets. In morning inter-bank trading, the shekel was up 0.25% against the dollar from yesterday's representative rate at NIS 3.827/$, and up 0.03% against the euro at NIS 4.205/€.

Yesterday, the Bank of Israel set the shekel-dollar representative rate up 0.052% from Friday's rate before the Sukkot holiday at NIS 3.817/$, and the representative shekel-euro rate was set up 0.036% at NIS 4.204/€.

FXCM Israel said in its morning survey, "After peaking at NIS 3.83/$ at the beginning of the week, its highest level since August 8, the shekel-dollar exchange rate has retreated slightly but is maintaining its strength above the key NIS 3.82/$ rate. We also saw a slight correction of the dollar on global markets with profit taking against the backdrop of strengthening expectations that the US Fed will raise the interest rate in December. The US Consumer price Index published yesterday indicating annual inflation of 1.5%, the highest since October 2014, points towards a rate hike."

Published by Globes [online], Israel business news - www.globes-online.com - on October 19, 2016

© Copyright of Globes Publisher Itonut (1983) Ltd. 2016

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Shekels Photo: Shutterstock
Shekels Photo: Shutterstock
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