Shekel Strengthens, Knesset Prepares For Marathon Budget Debate

USD/ILS trades -61 pips at ILS3.6463 with the shekel sitting atop the EMEA pile. A move through May 2 low of ILS3.6049 is needed to trigger a fresh bearish impulse. Conversely, bulls see Mar 20 cycle high of ILS3.7130 as their key near-tern target.

• The ruling coalition is rushing to approve the 2023/24 budget by the end of next week, with the Knesset preparing for a 35-hour plenary session on Monday to debate a package of bills making up the spending plan. The national budget must be adopted by midnight May 29 or else the Knesset will be dissolved for a fresh election.
• Likud sources told Maariv that if there is no progress in the ongoing negotiations brokered by President Isaac Herzog on the judicial overhaul and no progress in advancing the legislation, Justice Minister Yariv Levin will likely resign from the government. The newspaper reported that negotiators were nearing agreement on two issues, albeit other crucial sticking points remain. Separately, sources close to Prime Minister Benjamin Netanyahu told Ynet that they don't think that Levin would make good on his threats to quit as he is aware that this would mean the disintegration of the ruling coalition.
• Looking ahead, the Bank of Israel will release its latest CPI forecasts tomorrow.