The EUR to ILS exchange rate is currently range-bound as the euro faces near-term stability amid mixed market signals.
The interest rate differential favors the euro slightly, as the European Central Bank maintains a flexible policy while the Bank of Israel forecasts strong GDP growth. Improved geopolitical conditions following a Gaza ceasefire have strengthened the Israeli shekel, enhancing its appeal. Additionally, Eurozone economic growth is projected positively at 1.6% for 2026, contributing to euro support.
Over the next 1–3 months, the EUR/ILS rate is expected to trade within a stable range, reflecting recent lows near 3.6944, which is below its 3-month average. An upside risk includes any surprises from U.S. economic data that could weaken the dollar further. Conversely, a downside risk could emerge from renewed geopolitical tensions that impact investor confidence in the shekel.
Fluctuations in oil prices, which have remained volatile, could also play a part in the euro's value in the context of energy-market dynamics.