EUR/ILS Outlook:
The outlook for EUR/ILS is slightly weaker, but likely to move sideways as the rate is below its recent average and near recent lows. The EUR's performance has been restrained by weak industrial data.
Key drivers:
- Rate gap: The European Central Bank is maintaining an accommodative approach while the Bank of Israel recently cut interest rates, making the shekel more attractive.
- Risk/commodities: Oil prices have seen significant volatility and are currently above average, which can impact inflation in the Eurozone and pressures on the euro.
- Economic data: Eurozone industrial production dropped sharply recently, indicating challenges in economic recovery, while the shekel benefits from renewed investor confidence following geopolitical stability.
Range:
EUR/ILS is expected to hold within its recent range, reflecting current levels amid ongoing volatility.
What could change it:
- Upside risk: A positive shift in upcoming economic data from the Eurozone could boost the euro.
- Downside risk: Additional weak industrial figures or political developments in Europe could further depress the euro.
