The shekel has weakened against the major currencies at the opening of foreign exchange trading this morning. The shekel-dollar exchange rate is up 0.89% in comparison with Friday's representative rate, at NIS 3.4978/$, and the shekel-euro rate is up 0.95%, at NIS 4.6805/€.
The weakening of the shekel follows the release of macro figures yesterday showing that the Israeli economy grew at an annual rate of 1.7% in the second quarter, the lowest rate of growth recorded since 2009.
Commenting on the growth figures, FXCM Israel says this morning, "Even before Operation Protective Edge, the economy was on a slowing trend, and it can be assumed that in the third quarter figures, which will reflect the damage from the operation in the Gaza Strip, we will see a worsening of this trend. If, up to now, the market tended to ignore negative data and the shekel maintained its strength despite the circumstances, now, with the market changing direction, any negative local news will be a trigger for selling the shekel, bringing in train a sharper reaction from the market."
Published by Globes [online], Israel business news - www.globes-online.com - on August 18, 2014
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