Forecasts for USD to ILS
The USD to ILS exchange rate has recently been influenced by various factors, including geopolitical tensions, trade policies, and the Federal Reserve's monetary policy decisions. Analysts note that the US dollar experienced gains following the Federal Reserve's decision to hold interest rates steady, which reflects a cautious approach amid ongoing trade negotiations and economic uncertainty. This decision has contributed to the dollar's strength, especially as Fed officials signal that rates may remain elevated for a longer duration to assess the impact of tariffs.
The recent trade agreement announced by U.S. President Donald Trump with the UK has also offered some support to the dollar; however, the full implications of continued tariffs on major trading partners could weigh on its future performance. Market participants are particularly concerned about potential recession signals that could arise from the current administration's trade policies, which might counteract the dollar's recent strength.
In contrast, the Israeli shekel has faced considerable pressure due to the ongoing conflict in the Middle East. Recent events have driven the shekel to its lowest levels against the dollar in nearly eight years. The Bank of Israel's rare step to conduct foreign currency sales highlights efforts to stabilize the shekel amidst this turmoil. The imposition of a 17% reciprocal tariff by the U.S. on Israeli goods amid broader trade frictions adds another layer of complexity in the exchange dynamics.
Recent data shows the USD to ILS trading at 90-day lows near 3.5423, which is 2.7% below its three-month average of 3.6399. This indicates a tightening range with the currency pair fluctuating between 3.5423 and 3.8188. Experts suggest that the dollar's future trajectory against the shekel will largely depend on the Federal Reserve's next moves, the impact of geopolitical uncertainties, and developments in U.S.-Israel trade relations.
Stakeholders are advised to closely monitor the evolving economic and political landscape that influences both currencies, as shifts in monetary policy or escalations in conflict could significantly affect exchange rates in the upcoming period.
