Shekel Reduced by 2.82 Percent
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Shekel Reduced by 2.82 Percent

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The shekel was reduced by 2.82 percent Monday in its second devaluation since Aug.29.

The Bank of Israel set the new rate of exchange at 2.08 shekels to the dollar, up from 2.032 shekels last Friday.

The pending move was announced Sunday night by Finance Minister Yitzhak Moda’i and Michael Bruno, governor of the Bank of Israel, the country’s central bank.

They had not said what the exact rate of exchange would be, but a 1.5 percent devaluation had been expected.

The actual reduction of nearly 3 percent was triggered by a $27 million spurt in demand for foreign currency which the Bank of Israel made no effort to meet, unlike recent practice.

Under existing regulations, the central bank can adjust the value of the shekel daily without Treasury approval, as long as the adjustments range no more than 5 percent above or below the “mean representative rate” of the shekel against a basket of foreign currencies.

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