The dollar continues to soar today, hitting dollar option price of NIS 4.7050, up almost 4 agorot or 0.8% from the representative rate of NIS 4.667 set Friday, crossing the NIS 4.7 marker following the Beer Sheva shooting attack.
Options are rallying, as 20,000 of them already exchanged hands. According to an option dealer these are large acquisitions by an institutional investor. "It might be a mutual fund that has raised money and wants dollars, and the only way to do that on a Sunday is to buy options. The dollar climb is attributed to the lack of liquidity in the market, since on Sunday no dollar trading takes place and people don't want to take any risks."
Analysts at Meitav say the trend is clear: the shekel will continue to plunge. They estimate the dollar will range from NIS 4.65 to NIS 4.75 this week, and reach a NIS 4.8 zenith by the end of February. They analysts say the newly passed budget approved last week added to the market uncertainty, as its is now clear the government will have to raise great capital, which will pressure the market.
The analysts name other causes for the devaluation such as low interest gaps, the faded charm of short-term shekel investments, political tensions, the dubious advantage of dollar credit and lenders tendency to steer away from it, and a growing tendency of investors to transfer their monies abroad.