Dollar Falls to About NIS 3.02 on Israel’s Election Day

The dollar traded at about NIS 3.02 on Tuesday afternoon, October 27, as the shekel strengthened sharply on Israel’s election day. The euro was quoted at about NIS 3.37. The dollar’s decline extended the previous day’s fall; these were intraday market readings, rather than a report of a new representative rate set by the Bank of Israel. The reported size of the day’s move varied between market snapshots, with estimates of approximately 1.5% and 2% shekel appreciation against the dollar. Friday’s representative rates were NIS 3.11 for the dollar and NIS 3.48 for the euro. One weekly comparison put the shekel’s gain against the dollar at about 3% since the preceding Tuesday, even as the dollar index rose about 0.25% over that period. The Bank of Israel describes its currency-market role as “Supporting the orderly activity of the Foreign Currency market in Israel.” Its stated policy allows exchange rates to fluctuate freely, while reserving the right to intervene. Trading takes place between banks and customers in Israel and abroad, as well as among banks. The bank’s representative exchange rate is based on the prevailing market rate when it is set on a foreign-currency business day. It is an indicative rate without legally binding status, and parties to a transaction may agree to use a different rate.