Published On 11/6/2026
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Last update: 14:43 (Mecca time)
The Bank of Israel found itself facing criticism related to transparency and communication with the markets, after it later revealed the purchase of $801 million last May, in a step it described as “technical” to ensure the proper functioning of the exchange market, according to a report by the Israeli newspaper Calcalist.
The newspaper explained that the operation appeared in the bank’s periodic report without a special announcement, despite its previous confirmation of adherence to the policy of non-interference in the currency market.
The newspaper described what happened by saying: “The operation succeeded, but the patient died,” considering that the intervention achieved its technical goal but harmed the bank’s image and credibility.
When the bank lost control of the narrative
According to Calcalist, the bank confirmed that monetary policy had not changed, and that the intervention was not aimed at influencing the shekel exchange rate, but its delay in clarifying the motives for the move opened the door to different interpretations within the markets.
The newspaper added, “The central bank does not work only through interest rates or foreign exchange reserves, but also through expectations,” noting that these “expectations are built through clear and consistent communication.”
She considered that the bank’s silence “passed the microphone to others,” which fueled speculation about its succumbing to various pressures.
Technical intervention or undeclared policy?
The Bank of Israel confirmed that its intervention takes place through two paths:
- Previously announced programs, such as the October 2023 program to sell up to $30 billion.
- Or technical interventions to address market disturbances.
The report indicated that the bank monitors about 10 indicators related to pressure and liquidity, but refuses to disclose them for fear of being exploited by speculators.
The newspaper quoted internal sources as saying that the latest intervention came after a “jump in the warning system” (the financial market indicators exceeded safe limits), stressing that the operation returned the market to normal operation.
But Calcalist saw that the markets read the move differently, considering that it may represent a limited and undeclared intervention.
The power of the shekel and the dilemma of communication
Calcalist linked the controversy to the timing of the disclosure of the operation, as it came after the interest rate was reduced by a quarter of a percentage point and in light of warnings about the impact of the strong shekel on exports, which made it difficult for some traders to consider purchasing dollars as a purely technical measure.
The newspaper pointed out that the Bank of Israel does not view the strength of the shekel as the main problem, but rather sees it as a reflection of broader factors, including a decline in the risk premium, a rise in stock markets in America, and a weak dollar globally.
She added that the shekel has risen by more than 25% since April of last year, becoming “the strongest currency in the world against the dollar,” while the bank believes that buying $801 million, “and perhaps even ten times larger amounts,” will not be enough to change these trends.
