Bank of Israel Buying Dollars to Stem Shekel

Governor of the Bank of Israel Amir Yaron in Yerushalayim in March, 2019. (Yonatan Sindel/Flash90)

The Bank of Israel has resumed intervention in the foreign exchange market, buying large amounts of dollars, Globes reported on Monday, citing sources.

It marks the first time since Amir Yaron was appointed as governor of the bank at the end of 2018 that he has done so.

The decision was apparently made in light of the fact that the shekel has been strengthening against the dollar, affecting the exchange rate.

Yaron has repeatedly said that the central bank would take such action in the event that the dollar-shekel exchange rate strays from a pre-defined range.

At the conference of former governors sponsored by Globes, Yaron said, “No-one will receive notice” if the bank decides to intervene again.

Also on Monday, the BoI Monetary Committee announced a decision to “leave the interest rate at its current level for a prolonged period or to reduce it in order to support a process at the end of which inflation will stabilize around the midpoint of the target range, and so that the economy will continue to grow strongly.”

The committee cited as factors in the decision “the inflation environment in Israel, the monetary policies of major central banks, the slowing in the global economy, and the continued appreciation of the shekel.”

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