Foreign currency trading opened this morning with mixed trends. The shekel-dollar exchange rate rose 0.5% to NIS 3.48/$, and the shekel-euro exchange rate fell 0.41% to NIS 5.48/€.
Yesterday's shekel-dollar representative exchange rate was set at NIS 3.465/$, after rising 1.1% on the day before. The shekel-dollar exchange rate rose as high as NIS 3.49/$ in inter-bank trading during the day. The shekel-euro representative exchange rate was set at NIS 5.514/€, up 1.5%.
Teva Pharmaceutical Industries Ltd.'s (Nasdaq: TEVA; TASE: TEVA) acquisition of Barr Pharmaceuticals Inc. (NYSE: BRL), towards which Bank Hapoalim (TASE: POLI; LSE:80OA) and Bank Leumi (TASE: LUMI) will provide Teva with $1.8 billion in financing, is expected to boost domestic demand for foreign currency. Capital market sources say that Teva has been buying dollars on a large scale in the past few days for the acquisition.
In addition, IDB Holding Corp. Ltd. (TASE:IDBH) subsidiary Koor Industries Ltd.'s (TASE:KOR) announced that it plans to double its investment in Credit Suisse Group (NYSE: CS; SWX: CSGN; XETRA: CSGZ) to NIS 3 billion, and has also been buying foreign currency for this purpose.
Meanwhile, US Secretary of the Treasury Henry Paulson said that the administration wanted a strong dollar, and that the US interest rate may be raised in the near future, even before an economic recovery, in order to contain inflationary pressures. Comments by Federal Reserve Bank of Philadelphia President Charles Plosser reinforced Paulson's statements.
Easy Forex attributes the turnaround in the shekel to foreign institutions. It sets the closest shekel-dollar exchange rate support level at NIS 3.43/$ and the closest resistance level at NIS 3.50/$.
Published by Globes [online], Israel business news - www.globes-online.com - on July 23, 2008
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