Shekel Slides to 2.87 per Dollar as Rate-Cut Signal Sparks Foreign-Cash Shortages
Updated
Updated · Ynetnews · Jun 3
Shekel Slides to 2.87 per Dollar as Rate-Cut Signal Sparks Foreign-Cash Shortages
3 articles · Updated · Ynetnews · Jun 3
Summary
Currency dealers and commercial banks in Israel reported running out of dollar and euro cash on Wednesday after demand jumped following Bank of Israel Governor Amir Yaron’s signal of faster rate cuts.
The shekel weakened sharply after his remarks, with the dollar rising to about 2.87 shekels from the Bank of Israel’s 2.82 representative rate and the euro to 3.33 from 3.29.
Demand had already been strong before the speech because Israelis were buying cheap foreign currency for summer travel and as an investment after the shekel had appreciated more than 10% in recent months.
War-driven shipping insurance costs have also made it more expensive to bring banknotes into Israel, worsening the cash shortage just as Yaron hinted at a likely 0.25-point cut to 3.5% and ruled out dollar-buying intervention for now.
Businesses are now being urged to reassess foreign-exchange exposure, pricing and refinancing plans as a weaker shekel and lower borrowing costs reshape near-term financial conditions.