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Shekel Gains Amid Optimistic Reports On Israeli-Saudi Normalisation

ILS

Spot USD/ILS trades at 3.8077, down 61 pips on the session, with the shekel likely aided by the latest political developments. Technically, a break below 3.7520, which limited losses on Aug 24, is needed to confirm that a bearish reversal might be underway. Bulls look for a rebound towards Sep 8 high of 3.8612.

  • The shekel is supported by reports pointing to the prospect of Israeli-Saudi normalisation. Saudi Crown Prince Mohammed bin Salman told Fox News that normalisation is moving closer "every day," while the WSJ reported that Israeli Prime Minister Netanyahu was positively considering agreeing to a Saudi nuclear programme and told his officials to discuss the matter with Washington. Foreign Minister Cohen said that a normalisation deal could be reached in 1Q2024.
  • This comes after US President Joe Biden met with Netanyahu for the first time since the latter returned to power and extended an invitation to the White House.
  • Meanwhile, Israel's 12-months ahead CPI forecast was +2.8% Y/Y this month, unchanged from the revised August outturn.

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