(Israel Hayom/Exclusive to JNS.org) Bank of Israel Governor Stanley Fischer made a surprise announcement on
Monday that the central bank would cut the base interest rate by 0.25 percent
to 1.5 percent. The modified interest rate goes into effect on Friday, two
weeks before the original due date, to help stimulate export growth and
encourage investment as the shekel continues to rise against the dollar. The
dollar bounced back 1.5 percent to 3.6 shekels with Fischer’s announcement.
Bank of Israel Governor Stanley Fischer. Credit: International Monetary Fund.
The last time Fischer cut interest rates ahead of schedule was just
after the collapse of the Lehman Brothers investment bank, which helped
precipitate the global economic crisis in 2008.
The Bank of Israel said the reduction was outside its normal framework
and that it would not rule out a second cut to interest rates this month on the
scheduled date, May 27.