The shekel was stronger against the dollar for the second straight day in inter-bank trading Wednesday and stable against the euro after the European Central Bank (ECB) launched its loan plan yesterday in the latest effort to ease the euro zone debt crisis.
The shekel dollar exchange rate was down 0.38% at NIS 3.769/$ and the shekel euro exchange rate is up 0.04% at NIS 4.943/€.Tuesday afternoon, the Bank of Israel set the shekel-dollar representative exchange rate at NIS 3.783/$, down 0.37% on yesterday's rate, and set the shekel-euro representative exchange rate at NIS 4.945/€, down 0.15%.
Market sentiment Wednesday is expected to be strong with investors backing the ECB plan to combat the debt crisis through loans. The bank is set to launch a long term loan fund with options to repay early after 12 months. The rationale behind this is that capital will be injected into the financial system for the purchase of government bonds in particular and raising market liquidity in general.