Governor of the Bank of Israel Prof. Amir Yaron convened the Committee for Financial Stability this evening (Wednesday) for an extraordinary discussion. This, against the background of speculations that Yaron intervened in the foreign exchange market in an attempt to lower the dollar exchange rate. The gathering indicates pressure in the banking system.
The committee members include the Director General of the Ministry of Finance, Shlomi Heisler, the Deputy Governor of the Bank of Israel, Andrew Abir, the Chairman of the Securities Authority, Anat Guetta, the Commissioner in charge of the Capital Market, Amit Gal, the Supervisor of Banks, Yair Avidan, Head of the Systems Department Payments and clearing at the Bank of Israel, Oded Saloni, and the representative of the National Economic Council, Oded Salomi.
The committee meets for regular meetings four times a year, and additional meetings are held rarely and in times of crisis. The weakening of the shekel and the falls in the stock market are an unusual event that led the governor to take a step, the very publication of which may raise the level of concern in Israel and around the world.
The Bank of Israel usually intervenes in the foreign exchange market in times of crisis, when the shekel weakens radically, by selling dollars from the country’s foreign exchange reserves. The Bank of Israel does not report its intervention in the market in real time, but only at the end of the month.
Since Yaron took office as Governor of the Bank of Israel in 2018, the Bank of Israel’s foreign exchange reserves have jumped from $124 billion to over $200 billion. Today, the bank’s intervention was felt, when there were decreases in the dollar exchange rate throughout the day, even though at the end of trading its rate rose significantly Relatively small compared to yesterday.
The Bank of Israel refused to comment on the governor’s intervention in the foreign exchange market.