{"id":1431697,"date":"2023-10-09T12:20:00","date_gmt":"2023-10-09T16:20:00","guid":{"rendered":"https:\/\/bugaluu.com\/news\/?p=1431697"},"modified":"2023-10-09T12:20:00","modified_gmt":"2023-10-09T16:20:00","slug":"shekel-stabilizes-after-bank-of-israel-threatens-45bn-intervention","status":"publish","type":"post","link":"https:\/\/bugaluu.com\/news\/shekel-stabilizes-after-bank-of-israel-threatens-45bn-intervention\/1431697\/","title":{"rendered":"Shekel Stabilizes After Bank Of Israel Threatens $45BN Intervention"},"content":{"rendered":"

Shekel Stabilizes After Bank Of Israel Threatens $45BN Intervention<\/span><\/p>\n

\n

The Israeli Shekel tumbled overnight, down over 2% against the dollar, as the headlines – and images – of atrocities spread around the world.<\/p>\n

However, the currency has now stabilized following remarks from The Bank of Israel (BoI) that it stands ready to provide up to US$30bn of FX liquidity in the spot market and up to US$15bn in swaps<\/strong> against the backdrop of depreciation pressures on the Shekel.<\/p>\n

For now, BoI has said an emergency rate-hike is not on the table.<\/p>\n

<\/a><\/p>\n

Israel’s benchmark TA-35 index tumbled over 6% on Sunday but recovered from early losses on Monday…<\/p>\n

<\/a><\/p>\n

Economic activity will be likely disrupted, presenting a negative supply shock,<\/strong> according to Citigroup strategists including Michel Nies.<\/p>\n

\u201cAt the same time, fiscal support would probably have to be stepped up,<\/strong> both for reconstruction and loss of income support as well as for strengthening security measures,\u201d they say in note.<\/p>\n

\u201cA wide-scale call up of reservists could further reduce labor supply in an already tight labor market\u201d<\/strong><\/p>\n

\u201cThis could though be partly offset by job destruction in areas affected by fighting. On the demand side, a lot will depend on general threat perception which might weigh on consumption in sectors like hospitality\u201d<\/p>\n

However, as Goldman notes, Israel\u2019s underlying balance of payments position is much healthier today than it was during past major episodes of escalating tensions and conflict <\/strong>(>20 years ago), with a large current account surplus, a reduced reliance on foreign capital inflows, and an unusually large stock of foreign currency reserves (US$203bn, 39% of GDP).<\/p>\n

This strong balance of payments position has reduced Israel\u2019s economic and financial vulnerability to shocks <\/strong>and will ease the task of the Bank of Israel in addressing any financial stability implications from the conflict.<\/p>\n

If the negative market reaction persists or intensifies, we would not rule out further response by the central bank either via policy rates and\/or additional FX interventions. <\/strong><\/p>\n

In addition, in past episodes of conflict in the region, the Israeli economy has also benefited from significant financial inflows from abroad (from aid and other transfers).<\/p>\n<\/div>\n

Tyler Durden<\/a><\/span>
\nMon, 10\/09\/2023 – 08:20<\/span><\/p>\n

\u200bhttps:\/\/www.zerohedge.com\/markets\/shekel-stabilizes-after-bank-israel-threatens-45bn-intervention<\/a>\u00a0<\/p>\n

\u00a0<\/p>\n","protected":false},"excerpt":{"rendered":"

Shekel Stabilizes After Bank Of Israel Threatens $45BN Intervention The Israeli Shekel tumbled overnight, down over 2% against the dollar, as the headlines – and…<\/p>\n","protected":false},"author":0,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-1431697","post","type-post","status-publish","format-standard","hentry","category-news","wpcat-1-id"],"_links":{"self":[{"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/posts\/1431697","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/comments?post=1431697"}],"version-history":[{"count":0,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/posts\/1431697\/revisions"}],"wp:attachment":[{"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/media?parent=1431697"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/categories?post=1431697"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/tags?post=1431697"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}