Israeli shekel slumps to 7.5-year low amid war with Hamas

World News

The Israeli shekel just hit its lowest level against the US dollar in more than seven years, as the escalating military conflict in the country tests the currency and marks one of the most significant market fallouts of the strife.

The shekel has declined following Hamas’ attack on Israel.

AFP via Getty Images

Key Takeaways
  • Since the Hamas militant group launched a barrage of attacks against Israel beginning Saturday, the shekel dropped from 3.85 against the dollar to 3.96, a 3% loss of value.
  • That’s the shekel’s weakest level against the dollar since February 2, 2016.
  • The shekel’s slump continued Tuesday even after Israel’s central bank announced it would sell $30 billion of its foreign currency reserves to shore up the shekel.
  • Also sliding amid the increased tensions are Israeli stocks: The country’s benchmark TA-125 stock index measuring the 125 largest companies listed on the Tel Aviv Stock Exchange collapsed 5% in Sunday trading before paring losses with a 1% gain Tuesday.
Key Background

Currencies typically lose value as geopolitical instability rises in their home countries, causing a collapse in purchasing power of said currency. The dollar typically gains amid international strife as it’s widely considered a “safe haven” asset considering its historic holding of value even during economic downturns and geopolitical rockiness. The dollar index, which tracks the U.S. note against six other currencies, is flat since the Hamas attack but remains significantly elevated since prior to Russia’s invasion of Ukraine.


The dollar may be little changed but the impact on U.S. markets due to the conflict has been noticeable. Shares of defence contractors Lockheed Martin and Northrop Grumman both staged their largest single-day rallies in more than three years Monday, while energy stocks similarly surged as added instability in the Middle East caused oil prices to spike.

This article was first published on and all figures are in USD.

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