Shakel Cuts Losses But Remains Worst EMEA Performer

Spot USD/ILS has given up the bulk of its earlier gains, with market participants awaiting the outcome of the Knesset's vote on candidates for the Judicial Selection Committee. Latest reports have noted that the votes have been counted, yet the results have not been announced as of yet, which suggests that there may have been a recount.

• USD/ILS last trades at ILS3.5951, up ~330 pips on the day, after topping out at ILS3.6522. Overnight volatility extended yesterday's gains, albeit it has eased off its best levels of this session.
• The pullback in USD/ILS has been facilitated by broad-based weakness in the greenback, which underperforms all its G10 peers, as the BBDXY index has plunged to new one-month lows ahead of today's FOMC rate decision.
• Ynet reports that the estimates are that the outcome of the Knesset vote could be tight in the case of opposition candidate Karine Elharrar. Just four defections on the coalition side would suffice to greenlight her nomination and it was a secret ballot.
• It is unclear what the opposition would do if Elharrar was tapped to join the Judicial Selection Committee with respect to the ongoing judicial overhaul talks. Such an outcome could expose PM Netanyahu to backlash from his hard-line colleagues.