Bank of Israel to sell up to $30 billion to support markets – Kommersant

The Bank of Israel announced it would sell up to $30 billion in foreign currencies on the open market to support the nation’s currency and markets amid the war. This is the first time the Central Bank of Israel has sold foreign exchange reserves. As noted in the bank’s statement, quoted by the agency Reuters“The bank will operate in the market in the coming period to contain the volatility of the shekel exchange rate and provide the necessary liquidity for the continued normal functioning of the markets.”

The Bank of Israel’s decision followed a more than 2% drop in the shekel to its lowest level in seven and a half years. Moreover, even before the start of the war, the shekel was already quite weak: since the beginning of this year, it has fallen in price by 10% against the US dollar. Israel’s foreign exchange reserves, which it has never sold, are valued at more than $200 billion.

According to experts, the Israeli economy will cope with the situation. As noted in an interview CNBC former deputy head of the Bank of Israel Zvi Eckstein, “The Israeli economy is very strong, and unless there is a direct physical attack from Iran, then it is likely that Israel will be fully functioning economically in a week or two.” According to the expert, the shekel “will devalue somewhat as both Israelis and foreigners will reduce investments in Israel given the risks to the economy.”

Alena Miklashevskaya