Israeli Sheqel Looks Past Inflation Forecast and Continues Ascent
• Bank of Israel Forecasts 1.00% Inflation Target
• Dollar Experiences Spike Following Israeli Finance Minister’s Announcement
The Israeli Sheqel was little – changed following the Bank of Israel’s original inflation forecast of .70%, down from .90% in their previous announcement. Soon after the announcement the Bank of Israel revised their expectation to 1.00%, however the Sheqel continued to look past this announcement and continued its ascent as it has been doing since mid-August. The minimal response may be characterized by limited implications pertaining to short-term monetary policy; where the Bank of Israel has continued to keep rates at .25% since September 2014. The lackluster response may also have faded away from focus as investors continue to expect a weak Sheqel, when Finance Minister Yair Lapid told Bloomberg News that the Israeli currency was “too strong” on September 10, 2014. This data may have also etiolated from focus as a result of the on-going Israel – Palestinian conflict.