Fighting continues to boost shekel against dollar to NIS 4.75

Market expectations low from U.S. Secretary of State visit to Israel
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The shekel continues to gain ground against the dollar and is trading at NIS 4.75, compared with Wednesday representative exchange rate, NIS 4.767. Earlier, the shekel traded at NIS 4.743.

Investment bank Excellence estimates that foreign currency trade will continue being largely affected by the security situation.

Israeli forces have been mounting counter-terror operations in the West Bank for the last 14 days. Hezbollah forces in Lebanon have been firing rockets on Israeli army posts and on Israel over the last two weeks, and there are growing concerns about the escalation along Israel's northern border.

Excellence economists estimate that U.S. Secretary of State Colin Powell's visit to the region, due in Israel tonight, is only boosting the shekel mildly, as market sources don't have high expectations from the visit, for instance a cease-fire.

Excellence noted NIS 4.725 as the technical support level, and NIS 4.785 as the resistance level.

The shekel is also strengthening against European currencies. The shekel is stronger against the basket of currencies at NIS 4.7878, 0.55% higher than Wednesday rate of exchange. The shekel is rising against the euro to NIS 4.1736, up 0.6% from Wednesday.