Shafaq News/ On Monday, the Israelishekel dropped 1.5% against the dollar, and Tel Aviv shares fell over 1%, asinvestor fears grow over a potential attack from Iran and Hezbollah.
Recent Israeli assassinations ofHezbollah’s top military commander Fouad Shukr in Beirut and Hamas’s politicalleader Ismail Haniyeh in Tehran have heightened regional tensions, with Iranand Hezbollah vowing retaliation.
Yonie Fanning, chief strategist at BankMizrahi-Tefahot, said, “We anticipate significant repercussions from theIranian response, which is likely to create volatility.”
In addition, Hasnain Malik, head ofequity research at Tellimer affirmed, "Expectations of a ceasefire are lowand declining and the spectre of an Iranian retaliation remains.”
"The shekel is struggling tohold on to last week's gains amid rising market concerns that an attack by Iranon Israel could be imminent, based on comments from various officials from bothsides," affirmed Piotr Matys, senior FX analyst at InTouch CapitalMarkets.
By 12:55 GMT, the Israeli shekelfell to 3.77 per dollar, down from 3.72 on Friday but higher than the session'slow of 3.78.
The shekel has risen 0.1% againstthe dollar since August but has lost 5% of its value in 2023, as emergingmarket currencies struggle due to the dollar's strength. Meanwhile, stockindices in Tel Aviv dropped by 1.25% to 1.5%.
On Friday, Iranian news agenciesreported that an Iranian Revolutionary Guards deputy commander announced Iran'sintention to "harshly punish" Israel in response to the July 31assassination of Haniyeh, as ordered by Supreme Leader Ayatollah Ali Khamenei.
Two days later, Israeli DefenseMinister Yoav Gallant informed US Defense Secretary Lloyd Austin that Iran ispreparing for a major military attack on Israel.