www.bethelfinance.com
The shekel continues to weaken against the dollar as global markets absorb the fact that even the resignation of Italian Prime Minister Silvio Berlusconi will provide no quick fix for his country's economic woes. The shekel dollar exchange rate was up 0.7% in early morning inter-bank trading to NIS 3.738/$, however, by noon it had slipped back and was only up 0.12% from yesterday at NIS 3.717/$. Despite the euro zone's debt problems the shekel is stable against the euro and the exchange rate is down 0.04% at NIS 5.062/€.
This continues yesterday's trend in the foreign currency market when the Bank of Israel set the shekel-dollar representative exchange rate at NIS 3.712/$, up 1.03% on the previous day's rate, and set the shekel-euro representative exchange rate at NIS 5.06/€, down 0.16%.
The situation in Greece is also weighing heavily on markets with Greek Prime Minister George Papandreou's resignation yesterday paving the way for a national unity government. The new government's first priority will be to impose a new austerity plan and thus ensure receipt of the €130 billion bailout package.
The situation in Italy - the world's seventh largest economy - is far more complex. The country is deep in debt and bond returns have exceeded the 7% threshold. The fear that Italy is next in line to reach insolvency is spooking markets.
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