Dollar Holds Steady Near 3.07 Shekels as Fed Remains Wary of Inflation
Translated & summarized from Calcalist by baba
The dollar remained stable around 3.069 shekels on Thursday, as international markets saw the U.S. currency strengthen to a 1.5-year high. U.S. Federal Reserve meeting minutes revealed ongoing concerns about inflation, though they had little impact on expected interest rate decisions. The euro and pound weakened slightly against the shekel and the dollar.
The story in 5 lines · by baba
- The dollar held steady around 3.069 shekels amid minor fluctuations in the local foreign exchange market.
- The U.S. dollar reached a year-and-a-half high internationally due to Federal Reserve inflation concerns.
- Federal Reserve minutes showed officials still view inflation as the main economic risk.
- The euro weakened by 0.1% to 3.436 shekels, and the pound by 0.3% to 4.051 shekels locally.
- Investor expectations for the Fed's next rate hike remained largely unchanged after minutes release.
The local foreign exchange market saw minor movements on Thursday, with the dollar maintaining stability against the Israeli shekel, while the euro and pound experienced slight declines. Internationally, the dollar strengthened against major currencies, reaching a year-and-a-half high. This rise was influenced by the U.S. Federal Reserve's meeting minutes, which indicated that central bank officials still view inflation as the primary risk to economic forecasts.
In the Israeli market, the dollar traded at approximately 3.069 shekels. The euro weakened by 0.1% to trade at 3.436 shekels, and the pound lost 0.3% to trade at 4.051 shekels.
Globally, the euro was stable against the dollar at 1.120, while the pound dipped 0.2% to 1.320 dollars. In Japan, the dollar rose 0.1% to 158.22 yen. The U.S. Dollar Index, measuring the dollar against a basket of major currencies, increased by 0.1% to 102.11 points.
The dollar's recent strength follows market volatility after U.S. President Donald Trump's tariff announcements, termed "Liberation Day," the week prior. Federal Reserve officials unanimously supported a 0.25% interest rate hike at their September 15-16 meeting. However, the released minutes revealed differing rationales for the decision. Analysts from Westpac noted that the minutes reinforced a hawkish stance, with most participants believing further monetary tightening was appropriate and nearly all assessing upward inflation risks.
The publication of the minutes had minimal impact on investor expectations for the Fed's next interest rate decision. CME Group's FedWatch tool indicated a 19% probability of a 0.25% rate hike at the meeting concluding October 28, unchanged from the previous day.
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