Shekel Surges on BOI Governor Fischer Statement
Written by: Aaron Katsman | April 15, 2008
Aaron Katsman
www.IsraelNewsletter.com
The Israeli Shekel is once again surging against all global currencies on remarks by Bank of Israel Governor Stanley Fischer, saying that he expected the Shekel to continue to strengthen. What is strange about the comments is the fact that the BOI has been trying to prop up the US Dollar, actually intervening in the forex market, and stated their goal of weakening the Shekel.
So why the Fischer comments? I have no idea. Why would he come out in public and make statements that contradict the very policy that he himself implemented?
It’s possible that Fischer is worried about potential inflation in Israel, a phenomenon that we are seeing worldwide, and is signalling to the market that he isn’t going to cut interest rates anytime soon. He is planning to do all that he can in order to halt inflation, even at the expense of trying to devalue the currency.
Disclosure: He holds no position in any other stock mentioned as of 4/15/08.
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Aaron Katsman is Managing Editor of the Israel Opportunity Investor newsletter. He is lead portfolio manager for the Israel Growth Portfolio and Managing Director of America Israel Investment Associates, LLC. For more information, go to www.israelnewsletter.com or call 1-888-327-6179, or email aaron@profile-financial.com.
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