The shekel was the best performer in the past six months among 31 major currencies tracked by Bloomberg. Much of its success was attributed to the anticipation of gas flow from the Tamar field, which is expected to have a favorable impact on the Israeli government deficit.
Yesterday, for the first time since July 2011, the Bank of Israel intervened in the foreign currency market, after the shekel-dollar exchange rate fell to NIS 3.592/$. One source estimates that the Bank of Israel bought at least $100 million.
Governor Stanley Fischer, who will step down at the end of June, “is credited by some economists with helping the nation weather the world financial crisis by buying foreign currency to curb shekel strength and support exports.”
The Bank of Israel said that it acted in accordance with a declared policy of operating in case of “irregular swings in the exchange rate that aren’t in line with fundamental economic conditions or when the foreign currency market isn’t operating properly.”