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Israeli shekel gains after central bank hikes rate

By   |  Technical Analysis  |  Mar 28, 2011 05:55AM GMT  |  Add a Comment
 
SAN FRANCISCO (MarketWatch) -- The Israeli shekel climbed against the U.S. dollar Monday after the Bank of Israel raised interest rates by a more-than-expected 50 basis points to 3%. The U.S. dollar /quotes/comstock/21o!x:susdils  (USDILS  3.5201, -0.0015, -0.0426%) bought 3.5133 shekels, down 0.8% from Friday. The market consensus called for a hike of 25 basis points, according to the Royal Bank of Scotland. In a statement, the central bank said the decision was "consistent with the process of returning the interest rate to a normal range intended to position inflation firmly within the target range and to support the further recovery of economic activity, while maintaining financial stability." Analysts at RBS, in a note to clients, said the journey for appreciation in the shekel "may remain a slow grind as long as the prospect of capital controls is on investors' minds."

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