Patience has certainly paid off for those who have been waiting on better shekel exchange rates, as both the US and Canadian dollars again flexed their muscle against their Israeli counterpart. Meanwhile, the fog of Brexit continued to dampen the Brexit scene that also and Theresa May makes a new best frenemy. What could a week full of economic announcements as well as local Israeli elections have in store for the markets? Check out the Israel Currency Exchange Roundup for our expert take on it all.
USD/NIS Exchange Rate Benefits from Liquidity Concerns
What goes up must stay up is apparently the case when it comes to the USD/NIS exchange rate. Once again the rate moved higher in the week past, this time eclipsing the vaunted 3.70 level as it zeroes in on a return to its high of the year of 3.71. The big driver of USD strength right now appears to be in its liquidity amid the turbulent times in the markets, most notably with the Euro and the turmoil in Italy. From a technical trading perspective, the wind is clearly at the rate’s back due to the increasing strength in the US dollar along with the dwindling chances of a Bank of Israel interest rate hike before the end of the year. Our expectation is that this will continue for at least the next week, so if you’re looking to convert your currency to shekels, you could do a lot worse than taking advantage right now while the getting is good.
Is the CAD/NIS Rate Ready to Break Out?
It was also a promising week for the CAD/NIS, as in slow and steady fashion the rate worked its way higher from 2.78 to begin the week to finish up just about 2.82. A look at the charts shows that a key test of the 2.85 level, made back in early August, could be fast approaching. Should it break through, it wouldn’t be out of the realm of possibility to see it trade back up to its two year highs of 2.92. Consensus surrounding the Canadian economy is that its running at its full potential, so we’ll have our eyes on Wednesday when Canada’s latest GDP numbers are released. Much like the case here in Israel, the Bank of Canada seems to have taken a wait-and-see approach when it comes to interest rate hikes, so unfortunately we are left to do the same when it comes to speculating over the CAD’s long-term potential strength as we come up on the final leg of calendar year 2018.
Once Again Sterling Gets Tarnished by Brexit
And finally, on to Sterling where once again the GBP/NIS finds itself trading at the mercy of Brexit news. The latest muddying the waters has come in the form of new concerns from the EU nations of exactly how Theresa May can push any Brexit deal through Parliament. Compounding the complications are swirling rumors that Prime Minister’s top law officer is even leading the pro-Brexit revolt inside her Cabinet! The ripple effect keeps getting more and more tumultuous too, as recent data show nearly four fifths of British companies withholding investment due to the uncertainties, including over 58% of companies planning to cut jobs, adjust supply chains, relocate production and services or stockpile products if no clarity emerges soon on Britain’s future relationship with the European Union after Brexit.
With no resolution on the immediate timeline, we see no reason to expect a breakout in the immediate future of the GBP/NIS rate, and thus our opinion is that it will continue to spin its wheels for another week of trading back and forth between the 4.71 and 4.77 range – both seemingly pockets of both support and resistance.
The week to come has the potential to create some interesting scenarios – namely due to a heavy calendar of economic announcements, as well as lighter volume due to no trading on Tuesday due to local Israel elections. As such, we could see movements that are somewhat amplified across the board. While that may not result in the most accurate representation for where these rates should be trading, for anyone looking to do an exchange this week, an exaggerated “up day” may just be the time to do it.
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Bank of Israel Representative Exchange Rates
For the Week of October 22 thru October 26, 2018
|Currency||Symbol||Week High||Week Low||Week Close|
|South African Rand||ZAR/NIS||0.2601||0.2512||0.2536|
This Week’s Notable Economic Announcements
|Monday, October 29th||USD||Personal Consumption Expenditure Core|
|Tuesday, October 30th||EUR||Euro-Zone Gross Domestic Product|
|Tuesday, October 30th||USD||Consumer Price Index|
|Wednesday, October 31st||ILS||Unemployment Rate|
|Wednesday, October 31st||EUR||Euro-Zone Consumer Confidence Index|
|Wednesday, October 31st||AUD||Consumer Price Index|
|Wednesday, October 31st||CAD||Gross Domestic Product|
|Thursday, November 1st||GBP||Band of England Interest Rate Decision|
|Thursday, November 1st||GBP||Bank of England Inflation Report|
|Thursday, November 1st||GBP||Bank of England Asset Purchase Target|
|Friday, November 2nd||CAD||Unemployment Rate|
|Friday, November 2nd||USD||Unemployment Rate|
Wishing everyone a very productive and prosperous week from IsraTransfer and don’t forget to vote!
Searching for the easiest way to send money to Israel? IsraTransfer 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.