27 July 2015, 10:19
In the June meeting, all five MPC members of Bank of Israel voted to keep
policy on hold and this month should prove no different. Governor Flug in the
interim, expressing the opinion that Israel's economy is improving and that
deflation was all commodity price driven and will soon
reverse.
Commerzbank states, "Although we do not anticipate much inflation acceleration in Israel (see chart 1), we do believe that BoI will not look to introduce fresh unconventional policies now that the Fed is getting ready to tighten; BoI's underlying stance will track the Fed's for the most part."
Since the economy is showing a positive sign, the Bank of Israel (BoI) is expected to leave its benchmark rate unchanged at 0.1% today: the BoI has completed its rate easing cycle, and the next move will likely be up, although not until late 2016, according to Commerzbank.
The only potential issue could be excessive currency appreciation - BoI is perennially engaged in combatting shekel appreciation, which is why rates have been lowered to technical zero, and negative rates have been debated.
"We expect BoI to remind markets about such possible measures to push the shekel weaker - but, as the shekel is not rapidly gaining at this time, we do not see BoI taking concrete steps beyond sporadic FX intervention; we see USD-ILS hovering in the 3.80 region through end-2015", said Commerzbank in a report on Monday.
Source : FX-Primus
#FX
#Forex
#SaleForex
#BankOfIsrael
#LeaveMonetaryPolicyUnchanged
#UntilLate
Commerzbank states, "Although we do not anticipate much inflation acceleration in Israel (see chart 1), we do believe that BoI will not look to introduce fresh unconventional policies now that the Fed is getting ready to tighten; BoI's underlying stance will track the Fed's for the most part."
Since the economy is showing a positive sign, the Bank of Israel (BoI) is expected to leave its benchmark rate unchanged at 0.1% today: the BoI has completed its rate easing cycle, and the next move will likely be up, although not until late 2016, according to Commerzbank.
The only potential issue could be excessive currency appreciation - BoI is perennially engaged in combatting shekel appreciation, which is why rates have been lowered to technical zero, and negative rates have been debated.
"We expect BoI to remind markets about such possible measures to push the shekel weaker - but, as the shekel is not rapidly gaining at this time, we do not see BoI taking concrete steps beyond sporadic FX intervention; we see USD-ILS hovering in the 3.80 region through end-2015", said Commerzbank in a report on Monday.
Source : FX-Primus
#FX
#Forex
#SaleForex
#BankOfIsrael
#LeaveMonetaryPolicyUnchanged
#UntilLate
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