The Israeli new shekel is the currency of the State of Israel. The shekel consists
of 100 agorot. Denominations made in this currency are marked with the shekel sign,
₪. The Israeli new shekel has been in use since 1 January 1986 when it replaced the
old shekel that was in usage between 24 February 1980 and 31 December 1985, at a ratio of 1000:1.
The authoritative spelling on Israeli coins and banknotes is new sheqel, pl. new sheqalim,
though the spelling shekel is also commonly used.
History The Israeli lira, followed by the old shekel,
experienced frequent devaluations against the US dollar and other foreign currencies
starting in the early 1960s and accelerating from the mid-1970s. This trend culminated
in the old shekel suffering from hyperinflation in the early 1980s. After inflation was contained
as a result of the 1985 Economic Stabilization Plan, the new shekel was introduced, replacing
the old shekel on 1 January 1986, at a rate of 1,000 old sheqalim = 1 new shekel.
Since the economic crisis of the 1980s and introduction of the New Shekel, the Bank of
Israel and the government of Israel have maintained much more careful and conservative fiscal
and monetary policies along with the gradual introduction of various market-based economic
reforms. In addition, the signing of free trade agreements helped the Israeli economy
become more competitive, while heavy investment in its industrial and scientific base allowed
the country to take advantage of opportunities associated with the rise of the global knowledge
economy, thus greatly increasing exports and opening new markets for its products and services.
As a result of these factors, inflation has been relatively low and the country now maintains
a positive balance of payments. Consequently, its currency has strengthened considerably,
rising approximately 20% in value relative to the US dollar in the 2000s, thereby reversing
the trend of historical weakness the Israeli currency exhibited in the decades prior. In
the future, the exploitation of recently discovered natural gas reserves off the Israeli coastline
that is expected to begin in the mid-2010s decade and onwards may serve to further strengthen
the Israeli currency. Since 1 January 2003, the shekel has been
a freely convertible currency. Since 7 May 2006, shekel derivative trading has also been
available on the Chicago Mercantile Exchange. This makes the shekel one of only twenty or
so world currencies for which there are widely available currency futures contracts in the
foreign exchange market. It is also a currency that can be exchanged by consumers in many
parts of the world. On 26 May 2008, CLS Bank International announced
that it would settle payment instructions in Israeli New shekel, making the currency
fully convertible. Coins
In 1985, coins in denominations of 1, 5 and 10 agorot, ½ and 1 new shekel were introduced.
In 1990, 5 new sheqalim coins were introduced, followed by 10 new sheqalim in 1995. Production
of 1 agora pieces ceased in 1990 too, and they were removed from circulation on 1 April
1991. A 2 new sheqalim coin was introduced on 9 December 2007. The 5 agorot coin, last
minted in 2006, was removed from circulation on 1 January 2008.
In April 2011, it was reported that new coins would be minted that would use less metal
and thus lower costs. Counterfeiting would also be harder. The Bank of Israel is considering
dropping the word "new" on the planned coins series. If approved, this would be the first
replacement of all coins since the introduction of the new shekel coins in September 1985.
The coins are minted by the Korea Minting and Security Printing Corporation.
Circulation coins of the shekel are: Note that all dates on Israeli coins are given
in the Hebrew calendar and are written in Hebrew numerals.
Banknotes Beginning on 4 September 1985, banknotes were
introduced in denominations of 5, 10, and 50 new sheqalim. The 1 new shekel note followed
on 8 May 1986, and the 20 new sheqalim note issued on 12 April 1988 completed the family.
The 1, 5 and 10 new shekel notes used the same basic designs as the earlier 1,000, 5,000
and 10,000 old shekel notes but with the denominations altered.
In 1986, 100 new shekel notes were introduced, followed by 200 new shekel notes in 1991.
The 1, 5 and 10 new shekel notes were later replaced by coins. A plan to issue a 500 shekel
banknote, carrying the portrait of Yitzhak Rabin, was announced shortly after Rabin's
assassination in 1995. However, due to low inflation rates, there was no need for such
a banknote, and it was never issued. However, in February 2008 the Bank of Israel announced
that the planning of an entirely new series of banknotes has started, and that the new
series, to be issued in 2010, will most probably include a 500 shekel banknote as well. Though
still not decided officially, the new series is likely to consist of polymer notes only.
In December 2009 the Bank of Israel announced a new series to be issued in 2012, which would
bear the images of Theodor Herzl, David Ben-Gurion, Menachem Begin and Yitzhak Rabin. The plan
to issue a 500 shekel note was officially abandoned. The announcement was publicly criticized
and a few days later, the governor of the Bank of Israel announced that the issue be
reconsidered. The 20 shekel banknote is the first, as of
April 2008, to be made of polypropylene, a polymer substrate, which is superior to the
current paper note with a circulation life of a few months only. The polymer note is
printed by Orell Füssli Security Printing of Zürich, Switzerland. 1.8 million of the
new banknotes were printed with the writing "60 years [anniversary] of the State of Israel",
in red ink.
The committee proposed that the new series would bear the portraits of prominent Hebrew
poets, among them Rachel, Shaul Tchernichovsky, Leah Goldberg and Nathan Alterman. In December
2010, it was announced that the series would feature portraits of Menachem Begin, Yitzhak
Rabin, Rachel and Shmuel Yosef Agnon. When Begin's family opposed the decision, the committee's
original proposal was readopted. On 14 November 2012 the Bank of Israel announced
that the new series of banknotes is in the final stages of design. The first of the new
banknotes to begin circulation was in the 50 NIS denomination on 16th of September 2014,
the NIS 200 note is expected to be issued in soon after. The other two denominations,
NIS 20 and NIS 100, are expected to be issued in the beginning of 2015.
Gallery
Abbreviation In Hebrew the new shekel is usually abbreviated
ש"ח. The symbol for the new shekel, ₪, is a combination of the first Hebrew letters
of the words shekel and ẖadash. According to the standard Hebrew keyboard it must be
typed as AltGr-A. However, in Windows XP it can be typed on the default Hebrew keyboard
by pressing AltGr-4, however the sign does not appear on the physical keys of most keyboards
that are used in Israel and is rare in day-to-day typing. In Arabic, the currency is usually
denoted by the abbreviation ش.ج which is the initials of šikel jadīd, the currency's
name in Arabic. See also
Bank of Israel Economy of Israel
Paul Kor References
External links Bank of Israel catalogue of Israeli currency
since 1948 Exchange rates since 1948
American Israel Numismatic Association Current Sheqel Dollar Rate
Shaar yatzig – Official Rate gadget