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The dollar recovered slightly against the shekel yesterday, rising 0.4% to a representative rate of NIS 3.377. On Tuesday, the day before the Shavuot holiday, the greenback hit a three-year low against the shekel at NIS 3.36, falling 0.6%.

But traders noted that the day before the holiday was a shortened trading day with very light interest. "On such days, it's easy to push the dollar in one direction or another," said one trader. It's possible the large drop stemmed from speculators taking advantage of the light volume.

The euro fell slightly against the shekel yesterday, down less than 0.1% to a representative rate of NIS 4.931.

The shekel depreciated by about 1.2% against the dollar in May, and appreciated by 1.7% against the euro. The dollar strengthened against most currencies last month, including a 3% appreciation against the euro and 1% against the pound.

Industry, Trade and Labor Minister Shalom Simhon requested a cabinet discussion on the future of Israeli industry, in light of the exchange-rate developments. In a letter to Prime Minister Benjamin Netanyahu at the beginning of the week, Simhon said manufacturers and exporters were losing their competitiveness, which would have long-term effects on Israeli industry.

Foreign investors' share of trading in Israeli foreign exchange markets rose in May to 52% of total activity, up from 50% in April and 47% in March. The total volume of trading, including buying and selling of foreign currency, options and futures contracts, reached $113 billion in May, the Bank of Israel said yesterday. This is up from from $11 billion in April, but down from $118 billion in March.

The Bank of Israel bought about $305 million in May.

The volume of forex trade in spot and forward transactions was $42.6 billion in May, compared with $33 billion in April and about $42 billion in March. With that, the average daily trading volume in those transactions rose by 9% in May, compared with April, and reached $2 billion.