The Bank of Israel bought over $1 billion in foreign currency in February in its attempts to weaken the shekel. In its concern to encourage economic growth and assist exporters, the Bank of Israel Monetary Committee headed by Governor Dr. Karnit Flug also lowered the March interest rate to a historic low of 0.1%.
Israel’s foreign exchange reserves at the end of February 2015 stood at $85.316 billion, up $651 million from their level at the end of January 2015, the Bank of Israel reports.
The increase was the result of: a revaluation that increased the reserves by about $141 million and foreign currency purchases by the Bank of Israel totaling $1.045 billion, of which $245 million were purchased as part of the purchase program intended to offset the effects of natural gas production on the exchange rate.
These increases were partly offset by: government transfers abroad of about $311 million; and a decrease of $224 million from private sector transactions.
This is the first time Israel's foreign exchange reserves have risen since November 2014 and the reserves are still well below the all-time high of $87.628 billion in August 2014.
Published by Globes [online], Israel business news - www.globes-online.com - on March 5, 2015
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