For 2nd month in a row, Bank of Israel buys foreign currency in bid to stem sharp shekel gain

For the second month in a row, the Bank of Israel intervened in the foreign exchange market, buying $1.02 billion in June in a bid to curb the sharp appreciation of the shekel, according to the central bank’s monthly foreign exchange reserves report.

The central bank says the purchases in June were aimed “specifically to maintain the orderly functioning of the markets.” In May, the bank intervened in the FX market for the first time since 2022, buying $801 million.

The move comes as a host of business leaders and policymakers have criticized the central bank’s reluctance to act, saying​ the rapid shekel appreciation is harming exports, a major growth engine of ​the economy. The strength of the local currency is forcing exporters and startups to make tough decisions about hiring abroad and moving R&D centers out of Israel, stirring fears about future economic growth.