Shekel hits three-year-low against dollar

The shekel hit a three-year-low against the dollar on Monday as the Bank of Israel dropped interest rates and the US currency strengthened.

The dollar to shekel exchange rate hit 3.92 shekels — the strongest the dollar has been since June 2009. The shift was primarily attributed to the Bank of Israel’s lowering of interest rates by .25% to 2.25% on Monday amid fears of a global economic slowdown. The Israeli economy is expected to grow by only 3% in 2012, down from 4.8% in both 2010 and 2011.

The Tel Aviv stock indexes closed at a loss on Monday.

In Cairo, by contrast, political hopes yielded economic results. State TV said Egypt’s benchmark stock index closed with a record gain of 7.5 percent, following the declaration of Islamist Mohammed Morsi as victor in presidential elections.

Authorities halted trading on the Egyptian exchange for half an hour Monday after the EGX100 index rose more than 5 percent, triggering a “circuit breaker” to prevent drastic market fluctuation.

State TV said the market closed with a record increase. The benchmark index, EGX30, jumped by 7.5 percent.