By Steven Scheer

JERUSALEM (Reuters – In an attempt to limit the shekel’s rise, the Bank of Israel purchased $4 billion of foreign currency on Tuesday.

The central bank purchased $34 billion worth of foreign currency in the first eleven months of 2021.

November’s shekel saw a record breaking 26-year-old high of $3.04 per $1 and an even greater 20-year-high of $3.44 per EUR. This was after the completion of a $30 billion plan to purchase forex in October.

The shekel was the top-performing emerging currency in the pandemic. It rose up to 10% against USD since 2020 after an economic rebound that saw a fast COVID-19 vaccine roll-out and large foreign inflows into high-tech sectors.

The exchange rate has since fallen to 3.15 USD and 3.55 EUR.

Amir Yaron, Bank of Israel Governor, told Reuters that the bank will continue intervening in markets occasionally to stop big shekel movements. However it “is not necessary to announce a particular figure in advance” as this year.

The central bank reported that Israel’s forex reserves increased by $1.3 billion to $208.8 trillion last month, which is 45.9% of its gross domestic product.

It also stated that it purchased 3.4 billion Shekels ($1.1 Billion) of Israeli government bonds in the last month. That brings it to 83.5billion shekels, since it started this purchase program back in March 2020.

At 3.5 billion shekels, its balance in corporate bond purchases remained the same.

According to the plan, 85 billion shekels of Israeli government bonds would be purchased by Bank of Israel. The Bank of Israel announced that the scheme to end bond-buying stimuli would be ended by December.

($1 = 3.1534 shekels)