Economists Expect Dollar to Keep Rising
The rising dollar has a way to go, industry experts said this week. Closing at NIS 3.841/dollar on Thursday, a Calcalist survey of economists in Israel said that they expected the shekel to reach and even exceed the NIS 3.90 level in the coming weeks.
That would be good news for Israeli exporters, who often complain that they have difficulty competing in international markets because of the relative strength of the shekel versus the dollar. While shekel expenses for production remain constant, exporters get paid in dollars or euros, which are worth less in shekel terms when the Israeli currency is stronger. The Bank of Israel would also welcome increased “natural” strength for the dollar, so that it could cut back on its daily purchases of excess dollars in the market, a policy used to keep the shekel’s value from rising too high.
One reason for the shekel’s higher value in recent years has been the fact that interest rates in Israel were slightly higher than in the U.S., but with the Federal Reserve expected to raise rates throughout 2017 – perhaps as soon as December – investors are preparing to return to dollar investments, providing relief for the shekel.
Also contributing to the dollar’s strength is the prospect of a Hillary Clinton victory in the presidential elections. With polls showing Clinton ahead, especially in the electoral college vote, markets are “relaxing” somewhat, economists said, and factoring in the Clinton victory, which is preferred by markets.
To Read The Full Story
Are you already a subscriber?
Click "Sign In" to log in!
Become a Web Subscriber
Click “Subscribe” below to begin the process of becoming a new subscriber.
Become a Print + Web Subscriber
Click “Subscribe” below to begin the process of becoming a new subscriber.
Renew Print + Web Subscription
Click “Renew Subscription” below to begin the process of renewing your subscription.