The shekel is weakening against the dollar and strengthening against the euro in inter-bank trading this morning, reversing the trend of the past week. The shekel-dollar exchange rate is trading up 0.82% against the dollar at NIS 3.849/$, and down 1.51% against the euro at NIS 4.295/€.
Yesterday, the Bank of Israel set the shekel-dollar representative exchange rate at NIS 3.819/$, down 0.157% on Friday's rate, and set the shekel-euro representative exchange rate at NIS 4.361/€, up 0.347%.
FXCM Israel research department said this morning, "The shekel-dollar exchange rate is moving upwards as part of the dollar's technical correction on world markets. After falling to around NIS 3.80/$, the shekel-dollar exchange rate has jumped back up to NIS 3.84/$ over the past day. As not much was going on in the economic diary in the US yesterday, it is not possible to point to any particular trigger for this rise because it was just a technical correction with traders taking advantage of the sharp drop in the US currency last week to buy dollars now at a lower price."
FXCM added, "What dragged the dollar down last week, pulling it down to a four month low-point was a slew of poor macroeconomic data that very much cooled down interest rate expectations on the dollar and raised concerns on a slowdown in the pace of the US economy's recovery. This is also the focus this week with an economic calendar packed with data including housing and consumer figures. A key figure will be the US Consumer Price Index. A high inflation figure will again strengthen speculation about an interest rate hike and help the dollar recover. From a technical point of view, while the dollar remains below NIS 3.85/$, the downward pressure will continue. A fall below NIS 3.80 will pave the way to NIS 3.78/$ and below."
Published by Globes [online], Israel business news - www.globes-online.com - on May 19, 2015
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