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The majority of data and analysis at Financial Services Briefing is available only to subscribers. Each week, a small share of content from the service is made available to non-subscribers.

A series of tough measures, accompanied by equally tough talk, have made it clear that Bank of Israel governor Stanley Fischer is determined to prevent a crisis in Israel’s property market.

Israel’s latest directive imposing restrictions on the mortgage market was issued by its newly-appointed banking sector regulator, David Zaken, on April 28th and took effect on May 5th. It restricts the share of mortgages with adjustable rates that change at least once every five years to one-third of total lending. This restriction applies to all forms of financing in use in Israel, namely shekel floating-rate mortgages, loans linked to the consumer price index and loans linked to exchange rates (generally the shekel versus the dollar). According to the latest central bank data, these three channels comprise 48%, 32% and 6%, respectively, of total mortgage borrowing.

Read more at Financial Services Briefing: “Pre-emptive strike” (May 6th)

The majority of data and analysis at Financial Services Briefing is available only to subscribers. Each week, a small share of content from the service is made available to non-subscribers.

Israel has been fighting in the global currency wars longer than most. This March will mark three years since Bank of Israel head Stanley Fischer began interventions in the local foreign-exchange market to stem the appreciation of the shekel.

Caught between the need to raise interest rates to cool an overheating domestic economy and the threat that rate hikes will attract more foreign “hot money”, the Bank of Israel—like many of its counterparts in South America and elsewhere—is now trying capital controls.

Official policy has also changed toward foreign direct investment (FDI), the long-term investment traditionally seen as positive, if not essential, for sustainable economic development.

Read more at Financial Services Briefing: “War footing” (January 28th)

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