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As the shekel slides against the American dollar, shekel-denominated investment vehicles are weakening badly.

In options trade on Sunday, the dollar traded as high as NIS 5.06, an all-time low for the Israeli currency.

Bond market dealers say the trend demonstrates disappointment with the economic plan the government has adopted, especially after the Bank of Israel governor's scoffing comments about it.

The black mood surrounding the shekel has been exacerbated by ongoing violence between Israelis and Palestinians, and the Nasdaq's drop on Friday.

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Short-term debt certificates (makamim) are trading at sharp drops of 0.1% to 0.3% Sunday afternoon. Medium-term makamim of half a year and more, which closed Thursday on returns of 7% to 7.5%, are now trading at yields of 7.3% to 7.7%. The returns on year-plus makamim are more than 2% above central bank lending rates, which stand at 5.6%.

Annual unindexed Shahar bonds, which bear fixed interest, are trading at an average drop of 0.8%, with the 4-year 2665 series note off 0.6%. The five-year note of series 2670 is down 1.3%. The returns on the two are 8.60% and 9.31% respectively.

Nine-year series 2680 Shahar bonds are down 1.5%. Their yield to maturity is 9.58%.

Vehicles linked to the consumer price index are mixed. Bonds linked to the dollar are rising by about 1% thanks to the dollar's strengthening against the shekel.