JERUSALEM (Jul. 30)
Finance Minister Levi Eshkol today made a firm denial that the Government intended to devalue the Israel pound.
Mr. Eshkol told a meeting with several Israel bankers that “much water will flow through the Jordan to where it should not flow”–uselessly into the Dead Sea–”before we will consider alteration of the exchange rate.” He added that when the waters flow where they should flow “namely into the Negev, then the entire economic picture will be different. “
He pointed out to the bankers that there had been no increase in the cost of living index for almost a year. He said this proved that the Government had succeeded in stabilizing the purchasing power of the Israel pound, making devaluation unnecessary.
On the Tel Aviv Exchange, dollars and sovereigns, which have been showing upward tendencies in recent weeks, dropped immediately after Mr. Eshkols’ statement. Another anti-devaluation development was a rumor that there might be a new issue of Government-sponsored debentures, an unlikely move if devaluation was planned.