Subscribe to Print Edition | Sun., March 16, 2008 Adar2 10, 5768 | | Israel Time: 08:57 (EST+7) web haaretz.com   Back to Homepage Rosner's Domain Diplomacy Defense Jewish World Opinion National Print Edition Advertising Books Arts & Leisure Business Real Estate Easy Start Travel Week's End Anglo File

Bank of Israel Governor Stanley Fischer (Tess Scheflan) Last update - 10:59 14/03/2008 Markets fear central bank's buy of dollars won't stop U.S. plunge By Moti Bassok, Dafna Maor and Eytan Avriel, Haaretz Correspondents Tags: shekel, dollar  The central bank surprised financial markets Thursday by intervening in foreign currency trade for the first time since 1997. In response to the dollar's three percent fall against the shekel from a representative rate of NIS 3.48 on Wednesday to NIS 3.35 Thursday afternoon the Bank of Israel bought dollars in a move slated to strengthen the dollar against the shekel, despite the American currency's plunge on global markets. The currency market is readying for another day of trading in dollars, while sources in the market expressed concerns that the move by Bank of Israel Governor Stanley Fischer will not succeed in blocking the further drop in the dollar exchange rate. Advertisement The move came as a shock because Fischer and Bank of Israel foreign currency department head Barry Topf had previously said it was unlikely that the bank would intervene in the currency market. The Bank of Israel stubbornly refused Thursday to say how many dollars it had purchased. Its announcement said that "in light of the exceptional behavior of the shekel exchange rate in recent days, the Bank of Israel has purchased foreign currency during trading." The bank also refused to say whether it would continue to intervene in coming days. After the central bank started buying dollars and news of the move leaked to market players, the dollar rebounded against the shekel by over a percent, to reach NIS 3.43. The intervention caught the Finance Ministry by complete surprise. Finance Minister Roni Bar-On and other senior officials refused to comment Thursday. "It doesn't matter any more what the shekel does against the dollar - but what the shekel does against the euro and the yen," the investment manager of one of the branches of a foreign bank operating in Israel said yesterday. His comment reflected how little relevance the dollar now has to the strength of the Israeli currency, as a result of the steep declines in the American greenback in recent months. On Thursday, the shekel also rose against almost all other currencies: the euro-shekel exchange rate fell 1.7 percent to NIS 5.25, and the British pound lost 1.5 percent Thursday against the shekel to a representative exchange rate of NIS 6.92. Nevertheless, the shekel has stayed stable against the euro in the last year. Even a Federal Reserve announcement of a $200 billion borrowing plan for U.S. banks, which stirred Wall Street to 4 percent gains on Wednesday, did not impress foreign currency markets. It seems that foreign exchange markets are preparing for an expected 0.5 percent interest rate cut from the Fed next Tuesday. This will reopen the gap between U.S. and Israeli rates to 1.25 percent. Fischer will announce April interest rates on March 24. It is clear that the pressure on Fischer from the business sector, in particular manufacturers and exporters, to lower this gap between the dollar and the shekel will only increase as that date approaches. Related articles: Israel Bank intervenes in foreign currency market, buys dollars Dollar dips to new low Bookmark to del.icio.us   Not even for Natalie A Haredi actor quits Natalie Portman's latest film due to rabbis' protests. Al-Jazeera boycott Al-Jazeera slams Israeli boycott as attack on free expression.   1.   Drop in the bucket, won`t change anything 08:09  |  Ilan 14/03/08   2.   Buddy can you spare a dime? 09:40  |  Clickfool 14/03/08   3.   Stop Israeli foreign aid 11:17  |  Shlomo 14/03/08   4.   Buy euros before it is too late !!! 11:22  |  mehmet 14/03/08   5.   Could someone please explain? 11:28  |  Dan 14/03/08   6.   Golden opportunity to pay back debt! 11:28  |  Economist 14/03/08   7.   USA is finished 11:33  |  One of the chosen 14/03/08   8.   You mean Israel cannot 12:28  |  Chris Linthwaite 14/03/08   9.   #2 dan and the rest of the world goes with it 13:05  |  v ictor hardman 14/03/08   10.   #6 Victor Hardman 14:03  |  Chris Linthwaite 14/03/08   11.   #1 Clickfool: Yer right on the money 14:41  |  No Dope 14/03/08   12.   #1 boris the clucking fool spells out the uk problem 15:32  |  v hardman 14/03/08   13.   to little too late: ireaq war for israel cause inflation disaster 15:44  |  american 14/03/08   14.   Chris Linthwaite#7 16:46  |  S 14/03/08   15.   And the big winner is.....Europe. 17:05  |  Stephen. 14/03/08   16.   U.S. dollar falls below Swiss franc for first time ever (AP) 18:16  |  Chris Linthwaite 14/03/08   17.   #11stephen is a failed economist!!!! 18:26  |  v hardman 14/03/08   18.   Bear Stearns, Walls street`s 5th biggest bank 18:43  |  Chris Linthwaite 14/03/08   19.   #14 V Hardman putting to much emphasis in the $US 18:50  |  Chris Linthwaite 14/03/08   20.   #11 S 18:54  |  Chris Linthwaite 14/03/08   21.   Dow Jones below 10,000? 19:37  |  Clickfool 14/03/08   22.   It`s raining green paper!! 19:54  |  Clickfool 14/03/08   23.   #20 Chris Linthwaite 20:11  |  S 14/03/08   24.   How absurd 20:22  |  Mark Lincoln 14/03/08   25.   For S # 23 20:45  |  Clickfool 14/03/08   26.   #7 What`s up? 23:48  |  Matt 14/03/08   27.   hard-earned savings are dropping away fast 00:07  |  s 15/03/08   28.   # 17. Victor Hardman.....Wake up..look & Buy. 04:21  |  Stephen. 15/03/08   29.   Clickfool #25 09:52  |  S 15/03/08   30.   Low Dollar means export is cheap .. 14:00  |  SA 15/03/08   31.   SA #30 15:33  |  S 15/03/08   32.   Uncle Sam is broken 02:05  |  Daniel 16/03/08   33.   Buying dollars big mistake 08:25  |  Zev 16/03/08

Today Online Bradley Burston: Ten Commandments for Arab and Jew at war Responses: 348 Officials: IAF helicopter hit by Palestinian fire over Gaza Responses: 316 Police arrest rabbi for 'inciting Palestinians' in East Jerusalem Responses: 164 State Dept. notes rise in world anti-Semitism over last decade Responses: 291 Haaretz.com TV: Al Jazeera slams Israeli boycott as attack on freedom of expression Responses: 88 Rosner's Domain If you marry them, you have a better chance of keeping them State Department: UN measures fuel anti-Semitism (WTR) Poll: Is the "road map" still relevant? Neocons and the cultural proclivity of Jews (WTR) General Fraser and the third whiner More Headlines 08:48 IAF strike kills three Islamic Jihad militants in northern Gaza 02:20 ANALYSIS: Israel can expect an imminent end to the Gaza lull 08:18 Report: Syria wants 'public' peace talks with Israel 07:11 Bush to push Israel, PA for progress before his May visit 08:39 Treasury finally admits: Israel facing economic slowdown 00:29 Firebombs hurled into home of Jewish Agency representative in U.S. 01:59 Netanyahu says will sue Ch. 10 for report he overspent on London trip 08:08 Tibetan exiles in Tel Aviv protest Chinese crackdown in Tibet 02:34 Merkel to arrive in Israel, will be first chancellor to address Knesset 04:18 U.S. gov't asks Congress to okay plan to boost funds for PA police 08:02 Iran conservatives stay ahead in parliament vote count 08:04 Falashmura seeking to immigrate to Israel complain about treatment Previous Editions Select Day 14 mar 13 mar 12 mar 11 mar 10 mar 09 mar 07 mar 06 mar 05 mar 04 mar 03 mar 02 mar

Special Offers Advertisement FAREWELL ISRAEL New Film The Coming War for Islamic Revival - View Movie Trailer READY FOR PURIM? BUT - Who Will Guard The Hamentasch? Free the Palestinians from: Corrupt Kleptocracy, Tyrannical Theocracy, Abysmal Anarchy Long-term Israel programs MASA is your gateway. More programs. More grants. NEW! Dan Boutique Jerusalem Hotel Hip Dan Hotel in Jerusalem. Attractive Introductory Rates 7589 rockets fired so far HELP US TO HELP THEM FREE JEWISH HISTORY COURSE Berel Wein's best selling lectures. 5000 Years in Five hours /CD/MP3 Marina Royale Herzelia Pituach Your Luxurious Suite While Staying in Israel Fattal Hotel Chain Perfectly located hotels on best resorts of Israel. ISRAEL BONDS Build Israel Israel bonds - a multi-purpose way to celebrate Israel's 60th Eldan Rent a Car Israel's leading car rental company offers you a 20% discount on all online reservations Junkyard Junk a car - get free towing nationwide and a tax-deductible receipt

Home | TV | Print Edition | Diplomacy | Opinion | Arts & Leisure | Sports | Jewish World | Underground | Site rules |

Haaretz.com, the online edition of Haaretz Newspaper in Israel, offers real-time breaking news, opinions and analysis from Israel and the Middle East. Haaretz.com provides extensive and in-depth coverage of Israel, the Jewish World and the Middle East, including defense, diplomacy, the Arab-Israeli conflict, the peace process, Israeli politics, Jerusalem affairs, international relations, Iran, Iraq, Syria, Lebanon, the Palestinian Authority, the West Bank and the Gaza Strip, the Israeli business world and Jewish life in Israel and the Diaspora.

© Copyright  Haaretz. All rights reserved