The shekel is stable against the dollar and strengthening against the euro in inter-bank trading this morning, despite the dollar's strength on world markets. The shekel-dollar exchange rate is trading down 0.22% against the dollar at NIS 3.866/$, and down 0.24% against the euro at NIS 4.222/€.
Yesterday, the Bank of Israel set the shekel-dollar representative exchange rate at NIS 3.875/$, up 0.052% on Monday's rate, and set the shekel-euro representative exchange rate at NIS 4.232/€, down 2.103%.
FXCM Israel research department said this morning, "With the return to trading on the US markets following Memorial Day, the dollar is continuing its momentum from the end of last week and has strengthened 1% against the basket of the world's main currencies. The dollar index is currently trading at an almost eight year high, and it looks like after several months in retreat dollar sentiment is again peaking."
Energy Finance Financial Risk Management CEO Yossi Frank said this morning, "If no major steps are taken here the strengthening of the shekel will destroy the economy. I've been in the market over 20 years and I've never seen such exceptional circumstances as we've seen this week. The dollar is strengthening sharply throughout the world while here foreign banks and domestic speculators forcefully prevented the dollar from strengthening and it remains unchanged."
He added, "The foreign banks are threatening the Bank of Israel that it must lower the interest rate (so that they'll earn more on their bond holdings and other financial instruments) and when that didn't happen they are simply dragging down the market. They are threatening and taking action and the Bank of Israel remains indifferent. The Bank of Israel will intervene in trading today or tomorrow because it simply has no choice."
Published by Globes [online], Israel business news - www.globes-online.com - on May 27, 2015
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