Israel finmin supports cbank halt to daily FX buysJERUSALEM, Aug 11 (Reuters) - Israeli Finance Minister Yuval Steinitz said on Tuesday he supported the Bank of Israel's decision to halt a 13-month-old programme of buying $100 million a day of foreign currency that was aimed at preventing the shekel from strengthening.While the central bank stopped buying the $100 million of forex on Monday, it said it would still continue to intervene in the event of 'unusual movements' in the market.'I think that the Bank of Israel is acting judiciously and seeing all the various needs. We, of course, consult with them,' Steinitz told Israel Radio.'We talked about the Bank of Israel's steps in recent weeks. I think that the transition from a permanent daily commitment to buy dollars and the occasional intervention based on the situation, is generally correct,' he said.After gaining early in the session, the shekel was flat against the dollar at 3.87 per dollar in early afternoon trade.Steinitz said the aim of the government was to support Israeli exports -- nearly half of economic activity -- which have been hurt badly by a drop in global demand and a stronger shekel. He noted that the state is also providing guarantees to exporters.He said that the ministry was considering taxing speculators or raising taxes on foreign currency deals from overseas investors but such measures had failed in other countries.'The dollar is weak everywhere. It's our job to do all we can to support the exporters, as far as is reasonable and possible,' Steinitz said, adding that he won't 'determine a limit to (a fall) in the dollar rate'.On the state of the economy, Steinitz said he hoped that the ministry will be able to upwardly revise its forecast from a 1 percent contraction in 2009.'We'll wait another month or two to see that the good data, which are improving, from the last month or two, are indeed stable before risking new assessments and over-optimism,' he said. 'The most we can say is that we are on the right path.There are signs of stabilisation and optimism in Israel and around the world.'That is an encouraging development, but we must be cautious. I hope and believe, like the majority of international agencies that rate us, that we will indeed return to growth in 2010 and even the beginning of significant growth.'(Reporting by Steven Scheer; editing by Stephen Nisbet) Keywords: ISRAEL SHEKEL/FINMIN(steven.scheer@thomsonreuters.com; +972 2 632 2210; Reuters Messaging: steven.scheer.reuters.com@reuters.net)COPYRIGHTCopyright Thomson Reuters 2009. All rights reserved.The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
