Dollar Reaches About NIS 3.16 as Shekel Weakens Further

The dollar traded at about NIS 3.16 on November 3 as the shekel weakened further, reaching its weakest reported level against the U.S. currency since late March. The euro traded at approximately NIS 3.54. The dollar's rise extended the reversal from its intraday low of roughly NIS 3.02 on Israel's October 27 election day. The dollar was up about 0.6% in the day's trading. Its advance from the election-day low amounted to approximately 4.5%. Yossi Menashe, founder and co-CEO of Altshuler Shaham Financial Services, pointed to interest-rate differences and uncertainty over the political and economic outlook. He said some investors had taken short-term positions favoring the dollar. Modi Shafrir, Bank Hapoalim's chief financial-markets strategist, linked the currency movement to the previous Nasdaq decline, uncertainty over forming an Israeli government or holding another election, and geopolitical uncertainty. Eitan Kleiman, managing partner at Long Road, also cited political and security uncertainty alongside declines in U.S. markets. These were the analysts' explanations for the movement. The currency change has different implications for importers and exporters. Menashe warned: “Ultimately, a strong dollar means higher imported inflation.” Kleiman said exporters that receive dollars while paying some expenses in shekels can benefit from the stronger U.S. currency.