The Israeli shekel has faced uncharacteristic depreciation pressure over the past few weeks. Looking ahead, Wells Fargo economists expect ILS to post significant gains.
USD/ILS will move towards 3.40 by the end of Q1 2023
“Netanyahu defending BOI independence and the increasing likelihood of BOI FX intervention to support the shekel reinforces our view that the shekel is on the verge of a strong bounce back and can recoup most of the recent losses by the end of Q1-2023.”
“While the progress of Netanyahu’s judicial reform proposal in parliament could potentially see further weakening in the very short term, current USD/ILS levels are still attractive for investors to gain exposure to ILS and for corporates to hedge ILS-denominated spending.”
“We see benefit in entering positions at current levels and believe a move towards 3.40 by the end of Q1-2023 is imminent.”
