Central Bank Pushes Dollar Back Up 0.3%

The Bank of Israel once again intervened in foreign currency markets yesterday morning, as it bought a large quantity of dollars at about 9:40 A.M.

Dealers in the banks' forex trading rooms estimate the central bank purchased around $100 million.

The Bank of Israel responded that it reports foreign currency purchases only once a month.

At the end of the trading day, the dollar-shekel representative rate was set at NIS 3.824, up 0.34% for the day. But the dollar rose against the shekel by a full 1% after the Bank of Israel's morning intervention, hitting NIS 3.83, up from Monday's representative rate of NIS 3.785. The euro rose 0.7% against the shekel yesterday to a representative rate of NIS 5.399, as the dollar fell against the euro in world markets.

Early last week Stanley Fischer, the governor of the Bank of Israel, announced the central bank would stop its $100 million daily purchases, while continuing to purchase dollars as it saw fit.

The bank has bought up more than $2 billion in the past month, even though it made no new purchases from the middle of last week until yesterday's big buy.