ISRAELI SHEKEL FALLS TO ALMOST 8-YEAR LOW

Mon 09 October 2023:

The Bank of Israel on Monday said it would sell up to $30 billion of foreign currency in the open market, in the central bank’s first ever sale of foreign exchange, to maintain stability during Israel’s war with Palestinian militants in Gaza.

The Israeli shekel fell to an almost eight-year low against the US dollar on Monday as conflict in the Middle East escalates.

The move appeared to quickly calm the market as the shekel recovered from steep early losses.

“The bank will operate in the market during the coming period in order to moderate volatility in the shekel exchange rate and to provide the necessary liquidity for the continued proper functioning of the markets,” it said in a statement.

The central bank also said it would provide liquidity through SWAP mechanisms in the market of up to $15 billion.

“The Bank of Israel will continue monitoring developments, tracking all the markets, and acting with the tools available to it as necessary,” it said.

Ahead of the announcement, the shekel had weakened by more than 2 per cent to a more than 7-1/2 year low of 3.92 per dollar. The shekel now stands at a rate of 3.86, down 0.6 per cent.

-Reuters

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