Foreign currency trading opened this morning with the shekel-dollar rate rising by 1.9% to NIS 3.995/$. The shekel-euro rate also rose in interbank trading, before the start of trading on the Tel Aviv Stock Exchange (TASE).
The sharp gain in the shekel-dollar rate was already reflected in yesterday's options trading, following the announcement from the Bank of Israel that it would increase Israel's foreign currency reserves to $40-44 billion.
Since March 24, the Bank has purchased about $10 billion, raising the current level of Israel's foreign currency reserves to about $37 billion. The Bank of Israel has said that it will continue purchasing foreign currency at the rate of about $100 million per day, which means it is likely to reach the target sum within one to three months.
Since the purchases began in March, the shekel-dollar exchange rate has climbed by 25% or NIS 0.60 from NIS 3.20 to its current level of around NIS 4/$.
Governor of the Bank of Israel Stanley Fischer will explain the central bank's decision at a press conference this morning.
The shekel-dollar rate is currently up 1.89% at NIS 3.985/$ and the shekel-euro rate is up 0.17% at NIS 5.0636/€.
Published by Globes [online], Israel business news - www.globes-online.com - on December 1, 2008
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