After yesterday’s bombshell announcement by US President Donald Trump on US import tariffs, the foreign exchange market is risky at this time. In afternoon inter-bank buying and selling the shekel is strengthening towards the US greenback and sharply weakening towards the euro. The shekel-US greenback trade fee is down 0.19% at NIS 3.702/$, and the shekel-euro fee is up 1.95%, at NIS 4.093/€. The shekel is at its weakest towards the euro in 5 months.
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Yesterday, the Financial institution of Israel set the consultant shekel-dollar fee down 0.162% from Tuesday, at NIS 3.699/$, and the consultant shekel-euro fee was set 0.08% decrease at NIS 3.992/€.
Why has the shekel weakened sharply towards the euro?
The euro is reacting with a pointy achieve towards the Israeli forex. The rationale for that is the consequences of the assorted trade fee modifications. The shekel just isn’t traded instantly towards the euro, however is transformed on the dollar-shekel fee after which on the dollar-euro fee. Thus, when the greenback depreciates sharply towards the EU forex. Israel additionally sees the consequences of the devaluation. In actual fact, the most important beneficiary of the worldwide mess is the euro. The euro-dollar fee reached $1.09 per euro, the greenback’s lowest since October. “Reuters” famous that the euro is strengthening as a result of plainly Europe is wanting extra inward, “Europeans proceed to look at learn how to stabilize the economic system and proceed development and should not coping with reciprocal tariffs. The market likes the calm and settled method on the continent.”
Trying forward
The query that now arises is what’s going to occur after the worldwide storm calms down, and the way the heavy tariffs will have an effect on the worldwide economic system. Financial institution Hapoalim chief monetary markets strategist Modi Shafrir notes that a lot will depend on future developments. “There’s a worry that Europe and different nations will impose reciprocal tariffs on the US. In distinction, nations like Israel will possible scale back their taxes on the US.” Shafrir stresses that the present state of affairs just isn’t wholesome for the worldwide economic system and is rising ranges of uncertainty on the earth. Within the meantime, traders are fleeing to safer investments. Gold is buying and selling at report ranges at greater than $3,100 per ounce. Additionally, up to now 24 hours, authorities bond yields have fallen sharply, whereas traders are turning to risk-free belongings.
Printed by Globes, Israel enterprise information – en.globes.co.il – on April 4, 2025.
© Copyright of Globes Writer Itonut (1983) Ltd., 2025.
