IDF pullout stabilizes currency market, representative dollar - NIS 4.791
The beginning of an IDF pull out from Nablus and Jenin and the lack of additional significant security events, accounted for today's relatively stable foreign currency trade. The dollar dropped 0.06% on the local market and the representative exchange rate was set at NIS 4.791, after trading down 0.15% most of the day. The representative exchange rate for the euro was set at NIS 4.259, up 0.9%. The basket of currencies representative rate is up 0.23% at NIS 4.850.
Nonetheless, uncertainty regarding security developments and May Bank of Israel interest rates, yet to be determined, are also making it difficult for investors to make decisions.
Economists at investment bank Excellence estimate the banks have recently stocked up on dollars at about NIS 4.77. They believe the banks will inject supply at NIS 4.8, therefore, without an external factor such as deterioration in the security situation, the shekel will not depreciate below that rate. Excellence added that market players are engaged in exchanging options that expire in April, the expiration date approaching next week, for those that expire in May and June.
Foreign currency specialists Prico International maintain their estimate that the U.S currency will trade locally on a wide range with large supply expected at NIS 4.80-4.82, primarily from the business sector. This supply will curb shekel devaluation potential and support the local currency.
Discount Bank notes that with the shekel-dollar exchange rate at its current level of about NIS 4.8, March's monthly devaluation rate was 2.5%, which can be expected to be evident in the next few monthly consumer price indices.
