Shekel weakens as US tax cuts unveiled

Shekels Photo: Shutterstock
Shekels Photo: Shutterstock

Optimism in Europe after the French elections and fear that US corporate tax cuts will cause Israeli companies to move revenue abroad are weakening the shekel.

The shekel is weakening against the dollar and against the euro today. In morning inter-bank trading, the shekel-dollar exchange rate was up 0.12% from yesterday's representative rate at NIS 3.639/$ and up 0.26% against the euro at 3.97/€.

Yesterday, the Bank of Israel set the shekel-dollar representative rate down 0.384% compared with Tuesday's rate at NIS 3.634/$, and the representative shekel-euro rate was set up 0.214% at NIS 3.96/€.

After profit taking yesterday as the shekel corrected after a period of losses, the Israeli currency has resumed its slide today and is now well below its peak values last month against the dollar and the euro.

The euro continues to strengthen following the French election results at the start of the week, which indicated that pro-Frexit, fascist candidate Marine Le Pen is highly unlikely to win the second round on May 7.

The dollar is strengthening against the shekel after Donald Trump's tax cut plan has raised fears that the more competitive corporate tax in the US will cause Israeli companies to move revenue and profit to the US.

In any event the developments of the past week and the weakening shekel have given some relief to Israeli exporters, hit hard so far this year by the strengthening Israeli currency.

Published by Globes [online], Israel business news - www.globes-online.com - on April 27, 2017

© Copyright of Globes Publisher Itonut (1983) Ltd. 2017

Shekels Photo: Shutterstock
Shekels Photo: Shutterstock
Twitter Facebook Linkedin RSS Newsletters גלובס Israel Business Conference 2018