The shekel is weakening against the dollar and euro, in afternoon inter-bank trading. Today at 5:30 pm the Bank of Israel will announce the interest rate for November. The shekel-dollar exchange rate is 0.11%, compared with Friday's representative exchange rate, to NIS 3.645/$, and the shekel-euro exchange rate is up 0.79% to NIS 5.059/€. The euro is strengthening against the dollar at $1.389/€.
The interest rate will most likely remain unchanged, however a 25-basis point cut would not surprise macro economists following data that has recently been reported (such as a fall in tax revenues, a sharp decline in inflation expectations to under 2%, the unexpected drop of 0.2% in September CPI index, and a sharp fall in the Israel Purchasing Managers Index.
Yesterday, leaders at the European summit announced that the European assistance fund to countries in crisis will be based on countries around the world that have trade surplus and extremely large foreign currency reserves, such as China and Brazil. This will provide €440 billion to help leverage the assistance fund through the IMF and other countries, and thereby create a mechanism to support countries and large banks with extremely large amounts of capital.
Published by Globes [online], Israel business news - www.globes-online.com - on October 24, 2011
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