(Bloomberg) -- The Bank of Israel sees no reason to announce another major foreign-currency intervention plan to weaken the shekel given the economy’s swift rebound from the pandemic and a relatively low level of new Covid infections.

The export-driven economy “is so far performing well” despite a recent surge in the nation’s currency, Bank of Israel Governor Amir Yaron said in an interview with Bloomberg Television on Thursday. The central bank exhausted a $30 billion plan to lower the shekel last month.

The currency strengthened as much as 0.5% against the dollar after the governor’s remarks, before reversing course to trade 0.4% weaker versus the greenback at 3.1561 at 11:57 a.m. in Tel Aviv.

It has been the best-performing major currency against the dollar this year, potentially slowing plans to raise interest rates from near zero. The spread between U.S. and Israeli one-year interest rate swaps, a measure of market expectations for a country’s base lending rate in 12 months, widened to the most in more than a year this week.

Exporter Concerns

The shekel’s rise, boosted by record foreign investment in Israel’s technology industry, has caused concern for some of the country’s exporters. 

The central bank has said it will continue with accommodative monetary policy for as long as necessary to entrench the economy’s rebound from the health emergency. The bank expects growth of 7% this year and 5.5% in 2022, while the prospect of lockdowns seems remote given coronavirus cases have plummeted after a widespread roll out of booster shots. 

“The appreciation of the shekel reflects the strong economy,” Yaron said. 

Assuming there isn’t another major outbreak “we do not see the need to go to announce another quantitative program here,” Yaron said. “We are back in our discretionary type of intervention,” and the central bank “will continue to act in the FX market according to the economic activity as needed.”

Still, the central bank estimates that it will take a few years for the unemployment rate to fall back to pre-pandemic levels.

The shekel’s appreciation has helped mitigate the rise in inflation. Israel’s rate has remained consistently below the OECD average, despite a global hike in shipping and commodity prices.

“We have the luxury to be patient,” Yaron said, adding that the bank views the recent rise in inflation as “transitory.” 

(Updates with the governor’s comments. An earlier version of this story corrected the change in shekel-dollar trade)

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