A weaker dollar against the shekel boosts profitability for Israeli exporters with USD revenues and ILS costs.
Israeli high-tech firms and exporters are rebounding after a steep decline in the USD/ILS exchange rate eased pressure on earnings. Companies generate revenue in USD but incur costs in shekels, squeezing margins during the shekel’s strength over the past year.
The currency shift follows a period of heightened volatility, with the shekel trading near multi-year highs against the dollar in early 2024. Analysts had warned of prolonged headwinds for exporters if the trend persisted.
No immediate market reaction was reported, but sector analysts expect improved cash flow and profitability for affected firms.