After yesterday’s bombshell announcement by US President Donald Trump on US import tariffs, the foreign exchange market is risky right now. 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 price is down 0.19% at NIS 3.702/$, and the shekel-euro price is up 1.95%, at NIS 4.093/€. The shekel is at its weakest towards the euro in 5 months.
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Yesterday, the Financial institution of Israel set the consultant shekel-dollar price down 0.162% from Tuesday, at NIS 3.699/$, and the consultant shekel-euro price 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 acquire towards the Israeli foreign money. The explanation for that is the results of the assorted trade price modifications. The shekel is just not traded immediately towards the euro, however is transformed on the dollar-shekel price after which on the dollar-euro price. Thus, when the greenback depreciates sharply towards the EU foreign money. Israel additionally sees the results of the devaluation. The truth is, the largest beneficiary of the worldwide mess is the euro. The euro-dollar price 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 how you can stabilize the financial system and proceed development and usually are not coping with reciprocal tariffs. The market likes the calm and settled strategy on the continent.”
Wanting forward
The query that now arises is what is going to occur after the worldwide storm calms down, and the way the heavy tariffs will have an effect on the worldwide financial system. Financial institution Hapoalim chief monetary markets strategist Modi Shafrir notes that a lot relies on future developments. “There’s a concern that Europe and different international locations will impose reciprocal tariffs on the US. In distinction, international locations like Israel will seemingly cut back their taxes on the US.” Shafrir stresses that the present state of affairs is just not wholesome for the worldwide financial system and is rising ranges of uncertainty on this planet. Within the meantime, traders are fleeing to safer investments. Gold is buying and selling at file ranges at greater than $3,100 per ounce. Additionally, prior to now 24 hours, authorities bond yields have fallen sharply, whereas traders are turning to risk-free property.
Revealed by Globes, Israel enterprise information – en.globes.co.il – on April 4, 2025.
© Copyright of Globes Writer Itonut (1983) Ltd., 2025.
