The Israeli New Shekel (ILS), often abbreviated as NIS (New Israeli Shekel), is the official currency of Israel. It was introduced on September 4, 1985, to replace the old Israeli Shekel (ILS) at a ratio of 1 New Shekel to 1,000 old Shekels. The currency reform was implemented to combat high inflation rates that affected the Israeli economy during the 1980s. The Israeli New Shekel is issued and managed by the Bank of Israel, the country's central bank.
The Israeli New Shekel is abbreviated as "₪" or "NIS" and is subdivided into 100 smaller units called agorot. Banknotes are available in denominations of 20, 50, 100, and 200 New Shekels, while coins are minted in denominations of 10 agorot, ½ New Shekel, 1 New Shekel, 2 New Shekels, 5 New Shekels, and 10 New Shekels.
The value of the Israeli New Shekel is determined by market forces, with the Bank of Israel implementing a managed float regime for the currency. This means that the central bank allows the New Shekel to fluctuate within a certain range against a basket of currencies of Israel's major trading partners. The Bank of Israel intervenes in the foreign exchange market by buying or selling Israeli New Shekels to maintain the exchange rate within the desired range. This approach aims to ensure exchange rate stability, manage inflation, and allow for some degree of flexibility in response to external shocks and economic conditions.
The Israeli New Shekel is considered a relatively stable currency due to the country's strong economic fundamentals, prudent fiscal policies, and well-regulated financial system. It is used for domestic transactions and international trade with Israel. When conducting transactions with Israeli businesses or investing in Israeli assets, it is essential to be aware of the current exchange rate, any fees associated with currency conversion, and the potential risks associated with fluctuations in the foreign exchange market.