Written by: Aaron Katsman | June 1, 2009
It was only a few weeks ago that market pundits were predicting the US Dollar to reach 4.5 against the Israeli Shekel. Well what sayeth you pundits now?
Can you say 3.89???? Giddy up. The Shekel, like most other currencies continue to soar as President Obama continues to print money. We have seen a 7% fall in the USD/NIS rate in less than a month. Didn’t Obama say that he wanted a strong greenback?
It’s not exactly like the Israeli economy is on fire. This is clearly a USD story and doesn’t have much to do with the Shekel. As long as we continue to see businesses become nationalized, and the US Mint working 24/7, this has the potential to become a bigger and longer trend.
Written by: Aaron Katsman | March 25, 2009
The US dollar is flying by almost 2% against the Shekel this evening after the Bank of Israel said that they were stepping up the purchase of foreign currency.
According to Globes: “The central bank says it will buy government bonds to the tune of NIS 200 million daily, and will continue its program of expanding the foreign currency reserves at an average rate of $100 million daily.”
Why the need to weaken the Shekel? It has already dropped buy almost 30% in the last 6-9 months against the greenback. Trying to ignite an economy via inflation is bad news. Come to think of it wasn’t current BOI head Stanley Fischer head of the IMF back during the Asian, Russian and Latin American financial crises at the end of the ’90’s? Isn’t this a similar policy to what he recommended then? If so, look out. I sure hope that speculators don’t drive down the Shekel, like they did to Asian currencies 11 years ago.
How about a strong currency and to attract foreign investment, and lower taxes to help ignite long term growth?
Fischer is playing with fire, and if his track record is any indication, look out!
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Category:
Bank of Israel,
economy,
inflation,
shekel
Tags:
asian currencies,
Asian financial crisis,
Bank of Israel,
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greenback,
inflation,
latin american,
lower taxes,
playing with fire,
shekel,
speculators,
Stanley Fischer
Written by: Aaron Katsman | March 1, 2009
After moving almost non-stop from 3.2 -4.2, the Shekel has spiked the last few days as once again people get nervous over the US dollar. Currently trading after hours at 4.075, the shekel has joined most trading alone.of the worlds other currency’s, to route the greenback. In fact the euro is up more than 3% against the dollar in today’s global trade.
The question is whether we are in for another round of dollar weakness, or is this some profit taking as traders unwind their positions.
Written by: Aaron Katsman | February 25, 2009
Well, forget about interest rate differential impacting the shekel dollar exchange rate. The fact that the Bank of Israel only cut rates by 25 basis points has done nothing to stem the free-fall of the shekel. The shekel is trading near the 4.2 level. This continues the huge run of the greenback over the last 6 months. Keep in mind it wasn’t long ago that we were at 3.2.
Many technicians are saying that a break above the 4.25 level means a straight move to 4.4-4.5.
