web analytics
October 22, 2014 / 28 Tishri, 5775
At a Glance
News & Views
Sponsored Post
Meir Panim with Soldiers 5774 Roundup: Year of Relief and Service for Israel’s Needy

Meir Panim implements programs that serve Israel’s neediest populations with respect and dignity. Meir Panim also coordinated care packages for families in the South during the Gaza War.



Fischer Cuts Interest Rate and Says Bank to Buy 2 Billion Dollars

Cash transactions may be severely limited by this time next year, if the Prime Minister's Office has its way.

Cash transactions may be severely limited by this time next year, if the Prime Minister's Office has its way.
Photo Credit: Abir Sultan Flash 90

Bank of Israel Governor Stanley Fischer announced on Monday a surprise cut the prime interest rate as part of his battle to fight the appreciation of the shekel and help the economy to keep growing. The financial markets responded with the shekel-dollar rate rising more than 1.5 percent to the level of 3.61 shekels to the dollar.

Fischer announced the interest rate cut two weeks ahead of the usual end-of-the-month decision on whether to change the rate.

The dollar was worth only 3.55 shekels last week, dropping over the past several weeks from the relatively lofty level of 3.8 shekels to the dollar.

A lower shekel-dollar rate hurts exports because foreign buyers have to pay relatively more dollars than they would when the shekel is worth less. In addition, exporters make less money after converting foreign dollars into shekels.

Factors in the lower rate are the anticipation of tax revenue from Israel’s natural gas bonanza, which came on-stream several weeks ago, Warren Buffet’s $2 billion purchase of the remaining shares of the Israel-based Isracar tool-making company, the possibility of a $1 billion buyout of Waze by Facebook, and the relatively stable Israeli economy.

Fischer cut the rate by a quarter of a percent, with the new 1.5 percent rate making the shekel less attractive to foreign investors.

After the Bank of Israel’s two small purchases of dollars the past three weeks in an effort to keep speculators from forcing the shekel-dollar rate any lower, Fischer announced on Monday a massive dollar-buying plan on the scale of his purchases several years ago when the shekel-dollar rate sank to 3.30.

The Bank of Israel said the decisions to lower the rate and buy dollars was made “in light of the continued appreciation of the shekel, taking into account the start of natural gas production from the Tamar gas field, interest rate reductions by many central banks – notably the European Central Bank, the quantitative easing in major economies worldwide and the downward revision in global growth forecasts.”

The Bank of Israel added that global growth forecasts, especially for Europe and China have been revised downward, which effect Israel’s economy.

It explained that the program to buy dollars takes into account “the effects on the financial account resulting from the natural gas production” that will result in foreign exchange payments by the gas companies.

“As in the past, the Bank of Israel will continue to operate in the foreign exchange market in cases of exchange rate fluctuations which are not in line with fundamental economic conditions, or when conditions in the foreign exchange market are disorderly,” the Bank of Israel added.

About the Author: Tzvi Ben Gedalyahu is a graduate in journalism and economics from The George Washington University. He has worked as a cub reporter in rural Virginia and as senior copy editor for major Canadian metropolitan dailies. Tzvi wrote for Arutz Sheva for several years before joining the Jewish Press.


If you don't see your comment after publishing it, refresh the page.

Our comments section is intended for meaningful responses and debates in a civilized manner. We ask that you respect the fact that we are a religious Jewish website and avoid inappropriate language at all cost.

If you promote any foreign religions, gods or messiahs, lies about Israel, anti-Semitism, or advocate violence (except against terrorists), your permission to comment may be revoked.

No Responses to “Fischer Cuts Interest Rate and Says Bank to Buy 2 Billion Dollars”

Comments are closed.

SocialTwist Tell-a-Friend

Current Top Story
Newly elected Chief Rabbis of Jerusalem: Rav Shlomo Amar (L) and Rav Aryeh Stern (R).
2 New Chief Rabbis Elected for Jerusalem After 10-Yr Hiatus
Latest News Stories
Newly elected Chief Rabbis of Jerusalem: Rav Shlomo Amar (L) and Rav Aryeh Stern (R).

Israel’s holy capital of Jerusalem once more celebrates the election of both an Ashkenazi and Sephardic Chief Rabbi Jewish spiritual guidance in the city.

Chief of U.S. Homeland Security Jeh Johnson

Visitors from Ebola-stricken West African nations will be required to enter the U.S. from one of only five airports.

Israel's Deputy Ambassador to the United Nations David Roet, at a UNSC meeting held July 22, 2014 regarding the Palestinian Arab-Israeli conflict.

Israel’s UN ambassador refuted secretary-general’s hackneyed and false understanding of instability in the Middle East.

The mortar, which hit Israel on Tuesday morning, did not cause any injuries or damage.

After lying in coma for months, 83-year-old Ayatollah Mohammad Reza Mahdavi Kani has died, Iranian media reported Tuesday.

A radicalized Canadian convert to Islam rammed soldiers in what may have been an act of terrorism.

PA unity govt chairman Mahmoud Abbas raises the penalty for selling land to a “hostile nation” (Jew).

Israel’s government is recruiting citizens to help combat the Ebola virus epidemic in West Africa.

The Beach Boys aren’t coming to Israel next month…

The Jerusalem Light Rail has finally instituted a ‘zero tolerance’ police towards Arab violence against its trains.

A 2,000 year old stone fragment bearing an official Latin inscription dedicated to the Roman Emperor Hadrian is found in Jerusalem.

The woman’s father and other ISIS members stoned the woman to death for adultery.

Hamas has created a museum exhibit, currently showing at al-Aqsa University in Khan Younis, Gaza. Hamas is showing off its weapons and propaganda pieces from this past summer’s war, Operation Protective Edge.  

A bill that would end the control of the Chief Rabbinate over conversions to Judaism in Israel was nixed Monday by PM Netanyahu.

Haaretz smears U.S. terrorism expert for being a Republican and friend of Sheldon Adelson.

More Articles from Tzvi Ben-Gedalyahu
May God grant their wish to be killed.

ISIS propaganda video warns “our grandchildren will sell your sons as slaves.”

Let’s raise funds to send her to Syria where she can put some sense in her head, if it stays attached.

It is hard to believe, but Egypt is now dependent on Israel for gas instead of the other way around.

Barzilai hospital searched for its resident doctor-turned-terrorist after he disappeared and discovered that he changed professions.

A ‘good news’ story from the Nepal avalanche disaster to warm your heart. Take out your Kleenex.

Kerry might need to find a different spokeswoman who is better at lying.

Printed from: http://www.jewishpress.com/news/fischer-cuts-interest-rate-and-says-bank-to-buy-2-billion-dollars/2013/05/13/

Scan this QR code to visit this page online: