Shekel-Dollar Rate Fights Back against Fischer

The shekel-dollar rate Monday erased a large part of the rise following Bank of Israel Governor Prof. Stanley Fischer's announcement last Thursday that the Bank will buy $100 million worth of dollars a day in an attempt to prevent the local currency from getting stronger and hurting exports. The rate soared five percent by Friday afternoon and reached 3.39, but it dropped on Monday to below 3.33 before recovering to 3.344.



Fischer's action goes against his statements of last year that central bank intervention in currency trading usually does not work and often backfires. However, he said he was forced to act to try to prevent exporters, who have been receiving fewer shekels for incoming dollars, from going bankrupt and causing a drop in tax revenues.