1. The Exchange Rate
The shekel strengthened against the dollar, in contrast with the strengthening dollar worldwide.
In July, the shekel strengthened by about 0.3 percent against the dollar and by about 2.2 percent against the euro. Against the currencies of
In July, the dollar strengthened against most currencies--including by about 2.1 percent against the Swiss franc, by about 1.9 percent against the euro, by about 0.85 percent against the British pound, and by about 1.5 percent against the Japanese yen.
2. Exchange Rate Volatility
Actual volatility of the exchange rate increased along with a decline in the implied volatility of the exchange rate.
The standard deviation of changes in the shekel-dollar exchange rate, which represents its actual volatility, increased in July by about 0.5 percentage points to 3.9 percent.
The average level of implied volatility in over the counter shekel-dollar options--an indication of expected exchange rate volatility--declined to 5.9 percent at the end of July, compared with 6.1 percent in June.
At the same time, in July, the implied volatility in foreign exchange options in emerging markets also declined, to 6.8 percent on average. The implied volatility in foreign exchange options in advanced economies declined as well in July, to 5.5 percent at the end of the month.
3. The Volume of Trade in the Foreign Currency Market
Total trading volume increased as a result of an increase in swap transaction volume. Nonresidents' share of total trading volume declined.
The total volume of trade in foreign currency in July was about
The volume of trade in spot and forward transactions (conversions) was about
The volume of trade in over the counter foreign currency options (which are not traded on the stock exchange) totaled about
The trading volume of swap transactions was about
Nonresidents' share of total trade (spot and forward transactions, options and swaps) declined in July, to about 25 percent, compared with about 30 percent in June.
See chart & table here: http://www.bankisrael.gov.il/en/NewsAndPublications/PressReleases/Pages/10-08-2014-ForexMarket.aspx
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