More Israelis Than Ever Take Off for the World as Shekel Rallies

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by Yaacov Benmeleh

It’s shaping up to be a cheap summer for Israeli jet-setters.

Flying has become sharply cheaper in recent years after Israel opened its market to low-cost carriers. Now, outbound tourists are getting an extra dose of help from a surging currency that’s heading for the biggest annual gain in a decade. 

Israel’s economy grew more than twice as fast as the rest of the developed world in 2016 and is projected to beat its peers for the next three years. That, coupled with the dollar’s weakness is luring investors to the shekel, according to Rony Gitlin, head of spot trading at Bank Leumi Le-Israel Ltd. 

“Unless a big crisis comes, the pressure for a strong shekel will continue,” Gitlin said by e-mail.

This year, the Bank of Israel has been buying foreign currency at the fastest pace since 2010 to blunt the shekel’s rise and protect exporters. Few have given heed. The shekel has appreciated 8.8 percent this year, the best gains in the Middle East, and is trading near a record high.

International departures have risen more than 10 percent annually since 2013, with each successive year setting a record. In the first five months of this year, departures climbed 14 percent to 2.3 million, according to data from the Central Bureau of Statistics.

 

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