The shekel continued to strengthen in the local foreign exchange market on Tuesday against the backdrop of reports of progress in talks on the hostage deal between Israel and Hamas.
The shekel recorded significant gains against the dollar and the euro, with the dollar currently trading at 3.62 shekels, a decrease of about 1.3%, and the euro falling by 0.8% to 3.71 shekels.
The shekel's strengthening against the dollar comes amid assessments in the foreign exchange market that the chances of success in the negotiations to release the hostages are increasing.
The dollar lost ground following statements last night by US President Joe Biden, who announced that negotiations for an agreement between Israel and Hamas are at an advanced stage.
Biden noted that he spoke with Prime Minister Benjamin Netanyahu and added that the mediating countries - Egypt and Qatar - are working intensively to advance the deal. Biden emphasized that he and American officials are "pushing hard" to close the deal as soon as possible.
Progressing developments can shift markets
The foreign exchange market is responding to market assessments and reports on progress in negotiations for a deal that may affect Israel's economic system. Any progress in the hostage deal talks may ease economic uncertainty and support the strengthening of the shekel, especially as expectations for a positive deal strengthen.
In light of this, it appears that the shekel is expected to continue strengthening in the near future as long as negotiations for a deal continue and fuel optimistic sentiments in the foreign exchange market.