Injecting the beginning of the implementation of the deal to issue the Israeli hostages detained in the Gaza Strip optimistic, which led the trend to exchange the past few weeks. The market expects to prove the deal with Hamas, if it leads to calming the security situation in the long run, the benefit of the local economy.
“The developments surrounding the deal will be a long story. We are talking about 42 days, six weeks, and it is impossible to know how things will go during that time. There will be a great deal of fluctuations in the local market, in addition to fluctuations in foreign markets, emerging, among other things The entry of President -elect Donald Trump to the White House, said the founder and director of the Meitav Zvi Stepak “Globes”.
Stepak sets a positive trend in the Israeli stock market. “The market direction looks positive, as estimated a few weeks ago.
Another source in the market said: “If the deal is achieved and the second part of it is also advancing, and we see an end to the war and issue all the hostages, then this will support a continuous direction to rise on the stock exchange.” “My impression is that Trump is about to take it strongly and carry his weight on both sides.”
Market sources also say that the progress made in the deal will decrease a market. “
By adhering to the optimistic political scenario, analysts estimate that we will see a shekel increasing the US dollar. Last year, Shekel was reinforced against the dollar by 4 %, with a large part of that last week, as progress was reported in the hostage deal. On January 19, 2023, shekel exchange rate was $ 3.74/dollars. Friday, the representative exchange rate was determined at 3.60/$ NIS. There was no foreign exchange trading yesterday, but the trading of derivatives indicated that the shekel’s strengthening increased to 3.57/dollars. In this morning trading, the rate is currently 3.5764/$.
Inflation and interest rates
Hapoalim issued an economic survey yesterday, entitled “A whole people awaiting hostages.” Bank analysts describe acute inflation last year: “The high prices of food products meet us every day in the supermarket, and we are excessively aware. This feeling is not unique to Israel. There are great gaps between the rise in daily costs to keep the family (without lifting The standard of living) and the high consumer price index. “The bank says that the general feelings about daily expenses will eventually lead to a slowdown in consumption.
The bank estimates that reading the consumer price index for January, scheduled for mid -February, will be high, due to a wave of policy -based in Arnna (local property tax), electricity, water, and 1 % increase in the value -added tax rate. The bank sees the index’s rise by 0.5 %. If this is confirmed, the inflation rate for 12 months will reach 4 %.
In February and March, the consumer price index is expected to moderate. If this happens, it will be easy for the Bank of Israel to provide a reduction in the interest rate. The rate is currently 4.75 %, and the market evaluation is that the Bank of Israel will begin to reduce it in the second half of this year. If this is early, and made cuts in interest rates two or three, the rate can be 4 % by the end of the year.
It was published by Globes, Israel Business News – En.globes.co.il – on January 20, 2025.
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