October 6, 2022

Israelis Hit with Unprecedented Inflation, Shortages, Despite Tourism Boom

Tel Aviv…Israelis were shell shocked to find significantly higher prices for their holiday shopping and severe shortages of fresh chicken. Instead, supermarkets were forced to sell an unprecedented number of frozen chickens. In the meantime, the shekel continued to weaken against the dollar and against the euro. Early in the week the shekel exchange rate was up 0.47% against the dollar at NIS 3.553/$ and up 1.13% against the euro at NIS 3.424/€.This is the weakest that the shekel has been against the dollar since April 2020, at the start of the economic crisis caused by the Covid pandemic, when the dollar was also strong as investors sought a safe haven currency. The shekel has weakened by over 12% against the dollar since the start of the year. Israeli consumers feel the effect of the strengthening of the dollar in their pockets. The dollar has an inflationary impact since there are many things in Israel that are pegged to the dollar, such as air fares, fuel prices, and many services and goods imported to Israel.