post a message
LOGIN

Lost password? | Login trouble?

blank
News

| Top Five: Israel Business Week Roundup

Zev Stub    
Sunday, 11 February 7:34 PM

Powered by IsraTransfer Ltd.

 

February opened with a bang, as the currency markets saw the USD/NIS exchange rate seemingly shot out of a canon as it soared above 3.50 for the first time in a long time.  In other news, the Bank of Israel got a little spend happy, the Tax Authority set its sights on London, and the Central Bureau of Statistics got it wrong once again.  All that, plus the Prime Minister did a little shopping in the bargain bin.  Ready to travel back in time and find out what we mean?  Read on to get started.

 

1 -  From the Trading Desk



What a week it was in the currency markets, especially for those holding US dollars or British sterling!  After what has felt like an endless slump, the USD/NIS exchange rate rebounded in a big way, with a generous climb from 3.40 to over 3.50. Additionally, the best was pretty much saved for last, as the rate touched its week high of 3.53 late on Friday, before a mild retreat to close at 3.5170.  While the US stock markets have been the focus of attention behind US dollar strength, recent intervention by the Bank of Israel should not be overlooked as another driver behind the improved USD/NIS exchange rate .  As well, while the psychological 3.50 level had previously been assumed a source of resistance, the rate actually went through it without a problem, suggesting that we may not yet have reached this rally’s short-term trading top.


In sterling trading, huge news came in the form of comments made following last week’s Bank of England meeting suggesting interest rates are likely to rise sooner AND at a faster pace than previously expected. The well received announcement helped lift the GBP/NIS over 4.90, pushing the rate above that level for the first time since September 2016. While it has since slipped back down, there is a good chance that if the exchange rate gets back above 4.90, it could go on to test 5.00, that although much harder to break through, could suggest a breakout should it manage to do so.


Stay on top of daily trading in the shekel, plus notable news, economic announcements and more with IsraTransfer’s free Daily Shekel Report newsletter.



Bank of Israel Representative Rates

For the Week of February 5th thru February 9th, 2018


Currency

 

Week High

Week Low

Week Close

US Dollar

american-flag-icon-2.png

3.5372

3.4366

3.5170

British Pound

Flag_of_United_Kingdom_-_Circle-128.png

4.9102

4.8233

4.8634

Euro

european-union-circle-128.png

4.3312

4.2752

4.3092

Australian Dollar

australia-flag-png-16.png

2.7614

2.7140

2.7488

Canadian Dollar

canada_round_icon_256.png

2.8062

2.75400

2.7959

South African Rand

world.png

0.2936

0.2846

0.2927

Swiss Franc

switzerland_640.png

3.7710

3.6831

3.7444


Source:  xe.com



2 - Pocket Change



The Bank of Israel certainly kept its promise of more aggressive intervention in a month that featured its largest purchase of foreign currency since June of 2015.  With an eye on halting the shekel’s unprecedented strength, the January shopping spree included the purchase of over $1.8 billion in foreign currency. In total, the State’s foreign currency reserves have risen by over $4.6 billion since the end of December 2017 and now stand at an all-time high of $117.6 billion -  up from $101.6 billion USD only one year ago.  



3 - The Price is Wrong



It was yet another rough week for Israel’s Central Bureau of Statistics, as a new investigation by Globes uncovered errors by the agency in the measurement of food pricing. The report cited a useage of sample data manually collected to create indicators, rather than “true complete data” from official government databases, as the culprit behind the major discrepancy.  Critics of the Bureau's controversial  practice argue that the decision to use indicators instead of real sales creates a vastly distorted picture of food prices, an important metric that accounts  for 16% of Israel’s Consumer Price Index. Despite its unpopularity, the Central Bureaus of Statistics countered that their methodology remains the correct way of calculating the economy’s CPI, and gave no indications that it plans to change it.


4 - Tax Authority Crackdown



In its latest attempt to combat unreported capital located in the UK, Israel’s Tax Authority last week met with six of the UK’s largest banks to discuss ways of obtaining voluntarily account asset disclosures from their Israeli clients.  The Tax Authority estimates that billions of dollars in assets are currently held in London by Israelis, much of which has not been reported.  Obviously a difficult sell for the Tax Authority, some of the benefits to clients participating in the new voluntary disclosure program include an additional grace period to legalize any unreported capital up through the end of 2019, as well as both abbreviated and anonymous tracks that expire at the end of this year. Unfortunately for the Tax Authority, Israel  is unable to apply sanctions to overseas banks to compel them to help.  Nevertheless in the spirit of mutual cooperation between the two countries, the Tax Authority is hoping to convince the banks to exert pressure on their clients to voluntarily comply.


5 - The Western Walmart?



Further building on the momentum of Amazon’s plans to enter the Israeli market, Prime Minister Netanyahu, met with the world’s largest retailer to discuss the idea of Walmart in the Holy Land.  Regulation exemptions were a central element to Israel’s recruiting pitch, however, thus far the potential of the big-box-retailer operating in Israel doesn’t look likely.  While consumers would be expected to see more competitive pricing from an Israeli Walmart, it would also serve to drive wages down for retail industry workers.  Muddying the waters further are complications between Walmart’s anti-union policy and Israel labor unions that could also provide an additional snag in the deal.  Despite the adversity it faces, should Walmart in Israel go forward, under the law any regulatory exemptions it receives must also be extended to other retail businesses, so for the moment local shop owners can breathe a little easier.


Ok everyone, consider yourself officially caught up.  Have a very enriching and prosperous week!



 

Looking for the best way to transfer funds to Israel?  IsraTransfer Ltd. is Israel’s leading currency exchange firm specializing in wire transfers of US Dollars, British Sterling, Canadian Dollars, Euros, 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.

 
 
 
 
    




Janglo

Jerusalem's Best Jobs
Tel Aviv's Best Jobs
Jerusalem's Best Events
Jerusalem's Best Apartments
Jerusalem's Best Sales
Free Stuff in Jerusalem
Download Now: Android | iPhone
About Janglo
Contact Us
Advertise
FAQ


Terms Of Use
Privacy Policy

|| Make an effort to be happy each day, each hour.