In the face of continuing economic problems Israel has again devalued its pound against the U.
In the face of continuing economic problems Israel has again devalued its pound against the U.S. dollar. The devaluation of two percent is the second in just over six months.
Israelis were again dismayed at their further loss of buying power. But most accept the Government must take drastic measures if it is to control inflation which was last year estimated at 56 percent.
The Cabinet has assured the public that the new devaluation will not be followed by price increases in basic foodstuffs such as bread, oil, sugar, eggs or public transport. The prices rises for these items that followed the massive 43 percent devaluation last November led to riots in poor sectors of some cities.
At midnight local time on Tuesday (17 June) the Israeli pound was pegged at 6.12 pounds to the US dollar.
SYNOPSIS: In Israel, the ugly reality of inflation has forced the Government to devalue the Israeli pound yet again. The two percent devaluation was announced on Tuesday and took effect from midnight.
Israelis woke up to find the pound in their pocked would not buy what it would the day before. But the Government has been careful to emphasise that there will be no repeat of the increases in basic food prices that brought rioting last time the pound was devalued.
Tuesday's devaluation is the second in six months. Last November, in a desperate attempt to reduce inflation, the pound was devalued by forty-three percent.