The Israeli currency is at its weakest for eight months against the euro.
The depreciation of the shekel is gaining momentum following last week's surprise announcement of a 0.7% fall in the Consumer Price Index (CPI) in June. In early afternoon inter-bank trading, the shekel-dollar exchange rate was up 0.69% at NIS 3.5695/$ and up 1.32% against the euro at NIS 4.118/€, an eight month high.
Yesterday, the Bank of Israel set the shekel-dollar representative rate up 0.198% at NIS 3.545/$ from Friday's rate and set the shekel-euro rate up 0.669% at 4.0764/€.
The Bank of Israel had previously indicated that two interest rate rises can be expected in 2018. However, the latest negative inflation figures suggest that these hikes may not materialize. Furthermore, the geo-political tensions due to the troubles on Jerusalem's Temple Mount have also weakened the Israeli currency.
Published by Globes [online], Israel business news - www.globes-online.com - on July 18, 2017
© Copyright of Globes Publisher Itonut (1983) Ltd. 2017
Shekels Photo: Shutterstock