Bank of Israel Halts War-Related Market Interventions Since May
Translated & summarized from Arab48 by baba
The Bank of Israel has ceased all new activity in its war-related financial market intervention programs since May, according to its latest report. The programs, launched after the October 7, 2023, war outbreak, included foreign currency sales, currency swaps, and repo operations. The majority of interventions occurred in the early war months, with recent activity being minimal and now completely halted.
The story in 6 lines · by baba
- Bank of Israel's war-related market interventions have been halted since May.
- The report covers financial market activity up to September 30, 2026.
- Most interventions occurred in the initial months of the Gaza war.
- The bank sold $8.8 billion of foreign currency out of a $30 billion program.
- Repo transactions totaled 500 million shekels before the recent halt.
- A credit relief program for small businesses concluded in February 2024.
The Bank of Israel has recorded no new activity in its war-related financial market intervention programs since May, according to its latest monthly report. The report, released Wednesday, covers the period up to September 30, 2026, and indicates a complete cessation of operations in repurchase agreements (repo), dollar-shekel swaps, and foreign currency sales during the preceding five months.
Analysis of the data reveals that the majority of the Bank of Israel's exceptional interventions occurred in the initial months following the October 7, 2023, outbreak of the war in Gaza. These early interventions primarily targeted the foreign currency market and provided credit to small businesses. More recent interventions have been limited and infrequent, with the last recorded activity being repo transactions totaling 400 million shekels in March and April of the previous year.
When the war began, the Bank of Israel launched several programs aimed at ensuring market stability and supporting economic activity. These included a plan to sell up to $30 billion in foreign currency to mitigate shekel fluctuations and provide liquidity, as well as a $15 billion swap facility for foreign currency liquidity. The bank sold $8.2 billion in October 2023 and an additional $300 million in November 2023, with a further $300 million sale in June 2025. Total sales under this program reached $8.8 billion.
The dollar-shekel swap program, capped at $15 billion, saw only $400 million in activity in October 2023, with no subsequent operations. Repo transactions, used to maintain regular market functioning, recorded 95 million shekels in October 2023 and 5 million shekels in January 2024. Larger repo operations of 200 million shekels each occurred in March and April 2026, bringing the total to 500 million shekels before the halt in May.
Additionally, a credit relief program for small and micro-businesses affected by the war allowed the Bank of Israel to allocate up to 10 billion shekels in loans to banks and conduct repo transactions with non-bank lenders. This program saw significant activity, totaling 6.4 billion shekels between December 2023 and February 2024, concluding at the end of February 2024.
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