Bank of Israel Forex Defense: How Shekel Stability Shifted Since 2023

Why the €30 Billion Program Still Matters for Olim in 2026

In October 2023, the Bank of Israel made an unprecedented move: it announced a plan to sell up to $30 billion in foreign currency reserves to stabilize the shekel during the Hamas-Israel war. With the outbreak of the war with Hamas, central bank governor Amir Yaron announced a plan to sell up to $30 billion in foreign exchange to protect the shekel from collapse, allowing the Bank of Israel to intervene in the foreign exchange market during the war period to moderate volatility in the shekel exchange rate. Three years later, that framework remains active—but the pressures driving it have fundamentally changed. Understanding this before-and-after matters for anyone planning aliyah, because currency stability directly shapes immigration costs and real estate affordability.

Then, the crisis was sudden and military. Now, the challenge is structural: foreign investors made just NIS 2.7 billion in net share purchases in the first nine months of 2026, down nearly 70% from a year earlier. This pullback—driven by pre-election uncertainty and global capital rotation—creates a different kind of pressure on the shekel. The Bank of Israel's steady presence in currency markets has shifted from emergency response to routine market management.

The Before: October 2023 to Late 2024—War Shock and Currency Collapse Risk

Three years ago, olim faced a different problem. In the days after October 7, 2023, the shekel collapsed nearly 2.8% in a single session as foreign investors fled Israeli assets. Ahead of the announcement, the shekel had weakened by more than 2% to a more than 7-1/2 year low of 3.92 per dollar. The psychological impact was severe: diaspora Jews watching their Israeli real estate investments crater in dollar terms, olim second-guessing their timing, and mortgage costs suddenly spiking as shekel weakness made imported goods and foreign debt more expensive.

The Bank of Israel's response was direct. The central bank has sold only $8.5 billion in foreign currency to support the shekel since announcing a $30 billion intervention plan at the start of the Gaza war in October 2023, with most the foreign currency sold in October and November 2023. By selling dollars at the market's most anxious moment, the central bank signaled: Israel's reserves were deep, its financial system was intact, and panic-induced currency collapse would not happen. The shekel stabilized quickly.

For olim in that period, the practical calculus was simple: wait for the currency to stabilize before converting dollars to shekels, or risk locking in a weak rate. Many delayed their real estate purchases by months, hoping for a rebound.

The After: 2024–2026—Currency Strength, Foreign Investor Exodus, and Election Uncertainty

The narrative flipped entirely. Over the past three years, the shekel has strengthened against the US dollar, hitting a three-decade high in May, and Israel's stock market has surged. By early 2026, Israeli assets—especially tech stocks—were so attractive that foreign capital flooded in, driving the shekel to levels not seen since 1995. The shekel's 12 percent increase against the dollar in 2026 eroded export gains when measured in local currency terms; when converted into shekels, the value of export sales dropped by almost 11% from NIS 63.4 billion to NIS 56.7 billion, shrinking export revenue by more than NIS 6.5 billion ($2.25 billion) compared to the same period last year.

Now the central bank's concern reversed: too much strength, not too much weakness. Export companies complained. Tech hiring slowed. The Bank of Israel bought dollars to weaken the shekel—the opposite of 2023. This created an entirely different set of pressures for olim: the shekel was expensive, real estate was costlier in dollar terms than ever before, and uncertainty about what the October 27 election would bring made foreign investors tentative.

By October 2026, the dynamics shifted again. Foreign investors have cut their net net purchases of Israeli shares by nearly 70% this year, a pullback that Calcalist links in part to the October 27 election. The $30 billion authorization was no longer about emergency war-time stabilization—it was part of the Bank of Israel's standard toolkit for managing currency swings driven by political uncertainty and capital flows.

Today's Rate Environment: What Olim Encounter at the Exchange

The shekel currently stands at approximately ₪ 3.07 per dollar as of mid-October 2026. For practical comparison: in October 2023, the rate spiked to 3.92. In April 2026, the Bank of Israel set the dollar at 2.9830 shekels and the euro at 3.5119 shekels, meaning one dollar was worth just under three shekels. The current 3.07 rate reflects a middle ground—strong by historical standards, but well within the Bank of Israel's comfort zone.

The Foreign Investor Pullback: Why Political Uncertainty Matters More Now Than War

This is the real story hiding beneath the exchange rate. In October 2023, the crisis was clear: immediate military threat, survival concerns, currency panic. Central bank intervention was seen as temporary emergency medicine. Today, the threat is different—not acute, but chronic: political uncertainty, institutional questions, and concern about what an election outcome means for foreign capital treatment.

Many readers ask whether the election on October 27 will trigger another currency crisis like 2023. The short answer is no—but the shekel could move notably. Pre-election forecasts suggest a possible range: under a base assumption of an opposition victory, the shekel could strengthen by 2 to 3 percent as concerns about institutional reforms ease, while another win for Netanyahu could cause a 3 percent drop. That's enough to swing real estate valuations and payment timing for olim, but not enough to recreate 2023's panic.

What's different is scale and pattern. In 2023, Israel has amassed forex reserves of more than $200 billion, much of it from buying forex since 2008 to try and keep the shekel from strengthening too much and harm exporters as foreign inflows to the country's tech sector soared. The central bank has the firepower. But in 2026, the Bank of Israel's deeper concern is not stabilizing a crash—it's preventing a currency spiral driven by election-related portfolio shifts. That's a management task, not a crisis response.

What This Means for Your Aliyah Timeline and Real Estate Costs

If you're planning aliyah and watching the shekel, the before-and-after comparison offers three lessons:

• Rate Stability Is Better, But Timing Still Matters. In 2023, the shekel could move 2-3% in a single day. Today, moves are more orderly. But the current 3.07 rate is not