Massive Purchases by US Local Governments and Wall Street
Israel's Economy Rapidly Stabilizing
The Israeli government is reported to have sold all the bonds it issued last month following the surprise attack by the Palestinian militant group Hamas in the United States. Both U.S. local governments and Wall Street financial firms focused on purchasing the bonds, resulting in an unusual sale of $1 billion (about 1.3 trillion KRW) worth of bonds within just one month.
With the U.S. presidential election scheduled for November next year, it is interpreted that the U.S. political sphere actively provided financial support to Israel, mindful of the voting intentions of Jewish groups within the United States. As large-scale financial support begins in the U.S., the Israeli economy, which had been shaken since the outbreak of hostilities, is expected to stabilize rapidly.
According to CNBC on the 8th (local time), the $1 billion worth of Israeli government bonds additionally issued by the Israeli Ministry of Finance after Hamas’s surprise attack on Israel on the 7th of last month were all sold within just one month. The Israel Development Corporation (DCI), which managed the bond sales, stated that most of the bond buyers were U.S. local governments and financial firms.
According to DCI, this is the first time that Israeli bonds exceeding $1 billion have been sold within just four weeks. The main buyers of the bonds, as revealed by DCI, were more than 15 U.S. state and local governments including Florida, New York, Alabama, Arizona, and Ohio. While the main customers of existing Israeli bonds were Jewish financiers and Jewish organizations within the U.S., with the U.S. presidential election approaching in one year, it is interpreted that state governments rushed to purchase the bonds, conscious of the Jewish vote.
In an interview with CNBC, Dani Nave, CEO of DCI, said, "U.S. local and state governments, as well as investors large and small, have clearly expressed their support for Israel," adding, "This also shows confidence in a strong and stable Israeli economy."
The Israeli economy, which had been unstable since the start of hostilities with Hamas, is also being evaluated as stabilizing. If the war does not escalate and only limited clashes with Hamas continue, a clear economic recovery trend is expected to emerge.
Yaniv Pagot, head of trading at the Tel Aviv Stock Exchange, explained in an interview with major foreign media, "So far, the fighting has only occurred in the Gaza Strip and not in the north (Lebanon)," adding, "This fact helps local investors focus on fundamentals."
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