Shekel Inches Higher Amid Expectations That BoI Will Leave Base Rate On Hold Today

Spot USD/ILS is relatively stable and last changes hands at 3.7326, down 82 pips on the day. Bearish technical focus falls on the 23.6% retracement of the 2021 - 2023 upleg/Nov 21 low at 3.6937/3.6881. On the flip side, bulls look for a recovery past the 50-EMA at 3.8488.

• The Bank of Israel will announce its monetary policy decision at 14:00GMT/16:00IST. All economists polled by Bloomberg expect the central bank to keep the base rate unchanged at 4.75%.
• Citi refuse to fully rule out a 25bp cut, but suggest that monetary easing could potentially begin from January.
• Goldman Sachs believe that shekel appreciation significantly reduced pressure on the central bank, opening up more room to consider policy easing.
• Scotiabank argue that the BoI will likely seek to avoid adding pressure to the shekel amid the ongoing war.
• Wells Fargo see rates unchanged as the economic impact of the ongoing conflict is yet to be fully determined.
• The government will convene tonight to discuss an adjusted budget for the end of 2023. National Unity leader Benny Gantz, who has entered Prime Minister Benjamin Netanyahu's war cabinet, demanded that the decision should be delayed or funds allocated to ruling coalition parties should be cut, otherwise his party would vote against the budget.