Shekel Oscillates In Vicinity Of Cyclical Lows

Spot USD/ILS has oscillated between gains and losses, testing cyclical highs overnight. At typing, the pair deals at 3.7959, close to unchanged levels. Bulls set their sights on Mar 17, 2020 high/round figure of 3.8894/4.0000. Conversely, losses past Jun 2 high of 3.7551 are needed to give bears some initial reprieve.

• Prime Minister Benjamin Netanyahu brought forward a planned meeting of Israel's security cabinet, originally scheduled for September 10, to next week after two deadly terror attacks. This falls short of National Security Minister Itamar Ben Gvir's demand to convene the panel immediately. Separately, Likud remains locked in difficult talks with ultra-Orthodox coalition partners (Shas, UTJ) over the controversial military draft law, which the two parties insist should be quickly adopted.
• The Globes ran a piece yesterday noting that "market sources say that, while political divisions in Israel are weighing on the shekel, and the risk premium is around ILS0.30-0.40, the main factor behind the sharp depreciation of the past month is the situation on world markets, where the US dollar is strengthening."
• Israel's average 12-months ahead CPI forecast slipped to +2.7% Y/Y this month from +2.8% prior, according to data released by the Bank of Israel.