Dollar rate in Israel drops below 2.99 shekels and weakens on global market

The number of jobs in the US fell by 23,000 in July, causing the dollar to drop below 2.99 shekels. The dollar index fell 0.5% to 99.297 points. The unemployment rate fell to 4.1%, but economists warn of possible deterioration. The Fed may cut rates as early as the fourth quarter.

According to a report published on August 7, the number of jobs in the US unexpectedly fell by 23,000 in July, while analysts had expected growth of 83,000. This led to a weakening of the dollar: in Israel, the rate fell below 2.99 shekels, and on the global market, the dollar index fell 0.5% to 99.297 points. The unemployment rate fell from 4.2% to 4.1%, but this happened against the backdrop of a decline in the labor force participation rate, which economists say is not a positive signal. Data for previous months were revised downward: in June, only 20,000 jobs were created instead of the initially reported 57,000. Average hourly wages rose only 0.1% month-on-month and 3.2% year-on-year, below forecasts. Economists at Citigroup expect the Fed to cut interest rates three times by January 2027, starting in the fourth quarter. Ronen Menachem, chief economist at Mizrahi-Tefahot Bank, noted that the labor market has again proven deceptive and warned against hasty conclusions, as the market reaction may be excessive.