Shekel depreciates

After just 30 days, the shekel’s impressive run came to a sudden halt. In May, it was traded at NIS 2.8/$, but the exchange rate has now reached NIS 3/$, making the shekel one of the world’s weakest currencies in the past month. In fact, among the developed markets, only the Russian ruble and the Norwegian krone, both victims of the slide in the price of oil, have performed worse.

The shekel-dollar exchange rate, which only a month ago fell to NIS 2.80/$, has risen 7% in recent weeks and is approaching NIS 3/$, although this is still low by historic standards at a level not seen since the 1990s. Some believe that the pressure on the local shekel will continue, and that the dollar will continue to strengthen against the Israeli currency.