Forex Markets Face Volatility Amid Political Uncertainty and Sanctions
Foreign exchange markets face heightened volatility as political uncertainty and potential global sanctions threaten the shekel, warns Peri-Co CEO Yossi Freiman.
Yossi Freiman, CEO of Peri-Co Risk Management, Finance and Investments, warns that the foreign exchange market is heading for severe volatility amid ongoing political uncertainty and potential global sanctions. According to Freiman, the USD/ILS exchange rate is expected to fluctuate between 3.20 and 2.95 in the near term.
Fiscal Challenges and Tax Hikes Ahead
Freiman notes that any incoming government will face severe budgetary hurdles, including a widening deficit and mounting global sanctions. "Every government sworn in will have to address critical budgetary questions, the deficit, and global sanctions. It will be impossible to escape this, neither for Netanyahu nor for Eisenkot," he stated, adding that painful measures such as tax hikes will be inevitable.
Economic Resilience Versus Tech Sector Risks
While the Israeli economy possesses strong fundamentals that prevent a catastrophic collapse, prolonged political paralysis could stall interest rate cuts by the Bank of Israel and accelerate imported inflation due to a weaker shekel. Freiman warns that high-tech firms could bear the brunt of global sanctions, potentially forcing startups to relocate their intellectual property to the United States and undermining future exit deals.
