The Latest News:
- The Bank of Israel is leaving its benchmark lending rate unchanged at 1%, the lowest in four years, after reducing rates last month, reports Alisa Odenheimer for Bloomberg.
- “The Bank of Israel prefers to wait and see the impact of the last rate cut, even though it is clearly worried by developments in the export sector,” Ilan Artzi, chief investment officer at Halman-Aldubi Investment House, said in the article.
- The central bank has reduced rates from 3.25% since 2011 to depreciate the shekel currency and bolster the export-oriented economy.
- “For now, the rate will hold,” Ori Greenfeld, economist at Psagot Investment House Ltd, said in the article. “The Bank of Israel understands the rate cuts’ effect on the currency exchange rate is weakening. The bank will probably try other ways to influence the currency exchange rate, and maybe even do something with the Finance Ministry to try to weaken the shekel if necessary.”
- The Bank of Israel projects economic growth to slow to 3.4% in 2014 from 3.6% this year due to an appreciating shekel and a dip in exports.
Market Vectors Israel ETF
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Max Chen contributed to this article.