Last month, it was revealed that the U.S. has purchased all the bonds that the Israeli government issued following a surprise attack by the Palestinian militant group Hamas. Notably, local governments and financial firms on Wall Street were the primary purchasers, and an exceptional $1 billion worth of bonds were sold within a month.
This surge in financial support for Israel from U.S. politics is believed to be due to the upcoming U.S. presidential election in November next year and a conscious effort to win the favor of Jewish organizations within the U.S. With the start of substantial financial support from the U.S., the Israeli economy, which had been shaky after the conflict, is expected to stabilize quickly.
According to CNBC on the 8th (local time), the $1 billion worth of Israeli government bonds issued by the Israeli Ministry of Finance following Hamas’s surprise attack on Israel on the 7th of last month were all sold in just one month. The Israel Development Corporation (DCI), which managed the bond sale, revealed that the majority of the bond buyers were U.S. local governments and financial firms.
According to the DCI, it’s the first time that Israeli bonds of over $1 billion have been sold out in just four weeks. The DCI disclosed that the main buyers of the bonds were over 15 U.S. state and local governments, including Florida, New York, Alabama, Arizona, Ohio, etc. While the primary customers for Israeli bonds have traditionally been Jewish financiers and organizations within the U.S., it is believed that state governments have been actively buying the bonds ahead of the U.S. election next year, mindful of the Jewish vote.
In an interview with CNBC, DCI representative Dani Nave said, “Local and state governments in the U.S., along with large and small investors, have clearly expressed their support for Israel,” adding, “This also shows their confidence in a strong and stable Israeli economy.”
The Israeli economy, which had been shaky since the start of the conflict with Hamas, is now receiving positive evaluations for its stabilization. If the war does not escalate and only limited conflicts with Hamas continue, a clear economic recovery is expected.
Yaniv Pagot, the trading manager at the Tel Aviv Stock Exchange, explained in an interview with a major foreign media, “So far, the battles are only happening in the Gaza Strip and not in the north (Lebanon). This fact is helping local investors to focus on fundamentals.”
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