Staying Real in Israel
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More good news that the Israeli economic recovery is right on track..getting stronger and stronger.
And, the best news of all, looks like immigrant-from-America Bank of Israel Head, Stanley Fischer, will be staying on for another term…One of the best things that can happen to the Israeli economy, promising an even stronger recovery…Good things for the future…

Fischer hopes for return to ‘normalcy’


“The Bank of Israel is trying to bring interest rates back to a ‘normal’ level, which would bring inflation back down into the target range, and to support the recovery of the economy and financial stability,” Bank of Israel Governor Stanley Fischer told a central bank conference in Tel Aviv yesterday.

Reprinted from Haaretz.com Eytan Avriel

“All the while we will follow what’s going on in the world and take into consideration the shekel exchange rates,” Fischer told the conference, entitled “Challenges for the Future.”

“The central bank of a small, open economy cannot be indifferent to the exchange rate,” he said. When things start going back to normal, the bank will probably intervene less in the foreign currency market.

“We can reduce in stages the frequency of our interventions in the foreign exchange market, but it’s dependent on other considerations such as the interest rate, as well as the international and Israeli economy,” he said.

Fischer also addressed the challenges facing him at the beginning of a second term as bank governor. The first challenge involves the internal management of the bank.

Fischer also mentioned that discussions on the new Bank of Israel Law had just finished in the Knesset Finance Committee; next week the bill is expected to pass its second and third readings in the full Knesset to become law. The bill has been one of Fischer’s conditions for accepting a second term. Soon the bank will face the challenge of implementing it – “building a modern Bank of Israel, which the Israeli economy needs for the 21st century,” Fischer said.

The second challenge is fiscal and monetary policy as the world recovers from the financial crisis, he said. “There are countries that are managing to recover better … and there are countries that are having more difficulties…. During the crisis, the European nations handled it better, but now they’re having trouble,” he said.