What figure do you think we should pay most attention to here in Israel?
"The quickest barometer is the foreign exchange market. It provides an instant picture. If the exchange rate jumps, I know that something has happened. It’s the parameter that’s really closest to the markets."
If we look at the foreign exchange market, the shekel-dollar rate is fairly high. Will the depreciation continue?
"I hear many people say ‘the shekel will strengthen’ or ‘the shekel will weaken’ in the next month. There’s actually no way of deciding. Tossing a coin will do the job, really. In the long term, after the war, I believe that it will strengthen because of the structural factors in Israel. We have a surplus in the balance of payments current account. That is to say, in the end, more dollars come in than go out. In addition to that, we receive US aid every year. What’s more, the Bank of Israel’s foreign currency reserves stand at over $200 billion, and they’re the third highest in the world as a percentage of GDP. That’s a big safety cushion."
From Globes "Harel's Ofer Klein is sanguine about Israel's macro position, sees strong growth once the war ends, and doubts predictions of deep Fed rate cuts. ...."but expectations are one thing and events are another. The market is in a state of manic depression. "
Needless to say, I agree.
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