- Israel’s currency fell to a seven-year low following Hamas’ attack on Saturday.
- Israel’s central bank sold off $30 billion in foreign reserves in an effort to prop up its own currency.
- Strategists have warned the conflict will hit markets, commodities, and inflation around the world.
Following Hamas’ deadly attack on Israel Saturday, Israel’s currency weakened to a seven-year low against the dollar on Monday, and the Bank of Israel announced it would sell up to $30 billion in foreign reserves.
The Israeli shekel weakened about 1.6% early Monday to hover near 3.93 per dollar.
“The Bank will operate in the market during the coming period in order to moderate volatility in the shekel exchange rate and to provide the necessary liquidity for the continued proper functioning of the markets,” Israel’s central bank said in a statement Monday.
Meanwhile, market strategists have warned that the conflict threatens to fuel inflation, weigh on economic growth, and put pressure on stocks and commodities.
War and geopolitical headwinds also puts the Federal Reserve in a bind over whether to keep tightening monetary policy amid climbing recession risks.
Bill Ackman, the billionaire chief executive of Pershing Square, wrote a post on X lambasting US leadership and its role in the Middle East.
“Why did Hamas invade Israel last night? Because the United States has consistently not kept its word on its foreign policy commitments and we look very weak,” Ackman said. “Terrorism loves a leadership vacuum and we have created one. The world has become a much more dangerous place because we have not kept our word. This needs to stop now or, dare I say, hell is coming. The world is a much safer place when the US leads, and it quickly can become a living hell when we fail to do so.”
