It was yet another typical atypical week in the currency markets as the shekel overpowered conventional wisdom for the second time in a row. Meanwhile, a few minutes with the US Fed has the Bank of Israel thinking interest rate hike. Elsewhere, a bit of good news for Israel’s cryptocurrency community, and sterling gets pounded at the IsraTransfer Trading Desk. All that and more, plus some seriously sweet Israeli innovation. Ready to be enriched? Then scroll down and let’s get to it.
From the IsraTransfer Trading Desk
As expected, all eyes were on the Bank of Israel Monday when it kept interest rates on hold. Frankly, anything else would have been a major surprise. We do expect interest rates to start rising though in the last quarter of 2018, however, we also believe it has already been priced into the rate, so any mention of it shouldn’t have too much (if any effect) on trading.
The USD/NIS seems to have settled into a trading range between 3.56 and 3.58 since making a high of 3.63 back on May 3rd. This week attention will be focused around a busy economic data calendar that includes Gross Domestic Product numbers on Wednesday, and Employment figures on Friday. After watching how it’s been trading over the past few days, we are of the opinion that there is good support for the rate here, and think the next move is most likely higher rather than lower.
In sterling exchange, the GBP/NIS continues to get beaten down, now at 4.74, and well off its high of 5.00 only a few weeks ago. With a lack of economic data coming out this week, any developments surrounding Brexit will dictate where sterling trades in the immediate future..
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Bank of Israel Representative Exchange Rates
For the Week of May 21st thru May 25th, 2018
| Currency | Symbol | Week High | Week Low | Week Close |
| US Dollar | USD/NIS | 3.6032 | 3.5500 | 3.5264 |
| British Pound | GBP/NIS | 4.8477 | 4.7358 | 4.7382 |
| Euro | EUR/NIS | 4.2365 | 4.1477 | 4.1532 |
| Australian Dollar | AUD/NIS | 2.7161 | 2.6853 | 2.6925 |
| Canadian Dollar | CAD/NIS | 2.8025 | 2.7401 | 2.7465 |
| South African Rand | ZAR/NIS | 0.2883 | 0.2786 | 0.2852 |
| Swiss Franc | CHF/NIS | 3.6158 | 3.5771 | 3.6006 |
Source: xe.com
This Week’s Notable Economic Announcements
| Date | Currency | Announcement |
| Tuesday, May 29th | USD | Consumer Confidence Index |
| Wednesday, May 30th | EUR | OECD Economic Forecasts |
| Wednesday, May 30th | USD | Growth Domestic Product |
| Wednesday, May 30th | CAD | Bank of Canada Rate Decision |
| Thursday, May 31st | CHF | Gross Domestic Product |
| Thursday, May 31st | EUR | Consumer Price Index |
| Thursday, May 31st | CAD | Gross Domestic Product |
| Friday, June 1st | USD | Unemployment Rate |
*Source: DAILYFX
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Shekel Exchange Spotlight: US dollar
Those looking to convert US dollars to shekels didn’t exactly get the desired results out of last week’s currency trading, as the USD/NIS exchange rate continued its move lower, rendering itst high of 3.63 back on May 3rd a potential distant memory.
After attempting to recapture the magic that saw it reach the 3.60 level early last week, the exchange rate steadily declined. It now finds itself back in the 3.56 range – its lowest point since the month began.
Among the catalysts for shekel strength was the release of the US Fed’s latest meeting minutes revealing their plans for another three interest rate hikes by the end of the year, thus widening interest rate gap between the two currencies.
Following suit, the Bank of Israel is expected to do the same by the end of 2018, the first time its raised the rate since 2015. In the interim, however, while the US moves should theoretically be weakening the shekel, the economy’s outstanding 4% growth has kept it strong. Israel’s robust economy had previously received praise for its strengthening the shekel during the recent military activities in the region, another event that would normally weaken the currency.
Cryptocurrency Development
The journey forward in Israel’s cryptocurrency regulation has taken yet another step forward. In a draft legislation published by the Ministry of Finance, a provision has been added that for the first time will address cryptocurrency money laundering.
The new law, that goes into effect at the end of this week, will cover financial service companies that will include digital asset providers. The move is being celebrated by Israel’s cryptocurrency community who hope more regulatory certainty will help increase their ability to transfer money originating from cryptocurrency, which is currently an extremely difficult endeavor in Israel.
Israel Startup Scene
Sweet news for diabetics, or anyone else looking to cut down on their sugar and carb intake for that matter. Thanks to Israeli startup, A1C Foods Ltd., dietetic chocolate, ice cream, low-carb pizza and more healthy junk foods are potentially soon to be on the menu.
Unlike currently available diabetic-friendly options that are comprised of artificial sweeteners, A1C Foods snacks are made from actual flour, sugar, and other typical ingredients. However, the company’s secret sauce is found in its patent pending formulation technology that actually lowers its Glycemic index, or the impacts the treats have on blood sugar levels.
The company’s plans extend beyond just the diabetic market, with a full line of other popular healthy junk foods in development, that happen to also be rich in protein. Of course at the end of the day it all comes down to taste, which is why A1C has partnered with local chefs in developing their line, helping to ensure that everything both tastes great and is less filling.
Ok, consider yourself back in-the-know. Wishing everyone a very productive and prosperous week from IsraTransfer.
Looking for the easiest way to transfer money to Israel? IsraTransfer Ltd. is Israel’s leading currency exchange firm specializing in wire transfers of US dollars (USD), British sterling (GBP), Canadian dollars (CAD), euros (EUR), and more to Israel. Founded in 2008, and with over 1 billion NIS exchanged, we are the exclusive operators of the AACI Currency Exchange Program.