Bank Hapoalim recommends keeping 10% of investment portfolios in foreign currency.
Bank Hapoalim recommends keeping 10% of investment portfolios in foreign currency, and diversifying the holding between the US dollar, euro, and the Canadian dollar - which has demonstrated strength recently as oil prices soared. Analysts Ron Friedman and Moshe Sinai say that a number of factors are supporting the shekel, including the weakening dollar in international markets, Israel's relative economic stability, expectations of an interest rate hike, and the peace talks with Syria.
Bank Hapoalim predicts that the shekel-dollar exchange rate will be affected in the short-term by developments in dollar trading in international markets. The analysts note, however, "The low level of the dollar is making it even more difficult than ever to predict the future." The two conflicting trends affecting the shekel are the fact that it is stronger than when the Bank of Israel decided to intervene in the foreign currency market, which has lead to assessments of additional measures in the future; and the 125-basis point interest rate gap against the dollar, which is expected to widen, and support the shekel.
Published by Globes [online], Israel business news - www.globes-online.com - on May 25, 2008
© Copyright of Globes Publisher Itonut (1983) Ltd. 2008