For the first time in 30 years: the dollar drops below 3 shekels
The dollar exchange rate continues to decline and its value stands at less than three shekels • This is a three-decade low in the value of the currency
The shekel continued to strengthen on Wednesday, pushing the dollar exchange rate below 3.00, a level not seen in decades and one that is raising concern across key sectors of the Israeli economy.
The president of the Manufacturers Association, Avraham Novogrodsky, warned Tuesday that the currency’s strength should not be seen as a sign of economic resilience but rather as a growing risk to employment and competitiveness. He said that a nearly 20% drop in the exchange rate is effectively erasing exporters’ profit margins, with direct consequences for factories and workers.
Data from a February survey by the association highlights the scale of the impact. Some 79% of manufacturers expect a decline in gross profit, while 63% anticipate a drop in sales. Export revenues in dollars are shrinking, while operating costs in shekels, including wages, energy, taxes, and property costs, continue to rise, putting pressure on day-to-day operations.
The trend is also affecting the high-tech sector and multinational companies. A stronger shekel makes Israel more expensive in dollar terms, potentially discouraging investment and prompting firms to shift activity abroad. According to the survey, 51% of companies expect to scale back operations in Israel, and 40% are considering relocating part of their production overseas.
The Manufacturers Association estimates that without intervention, export losses in 2026 could reach 31.5 billion shekels, with an additional impact of 16.5 billion shekels on GDP. Novogrodsky called on the government and the Bank of Israel to adopt measures to support exporters, reduce regulatory burdens, and encourage local procurement, warning that failure to act could lead to loss of markets and long-term economic damage.