TEL AVIV, Oct. 9, 2025 (Chatnewstv.com) — The Israeli shekel strengthened sharply and stock markets rallied Thursday after Israel and Hamas signed the first phase of a U.S.-brokered peace plan, fueling hopes of an end to the war in Gaza and a broader regional breakthrough.
The dollar fell 0.6% to 3.26 shekels, its lowest level in more than three years, while the euro dropped 1% to 3.77 shekels. Investors also poured into Israeli equities, sending the TA-35 index up 2.3%, the TA-125 up 2.9%, and the TA-90 soaring 4.6% — all closing at record highs.
The construction index jumped 9.1%, while the yield on 10-year government bonds dropped eight basis points to 3.958%, reflecting a sharp fall in perceived risk.
The rally followed an early-morning announcement from U.S. President Donald Trump, who declared that both sides had agreed to the first phase of his peace plan.
“I am very proud to announce that Israel and Hamas have both signed off on the first phase of our Peace Plan,” Trump said on Truth Social. “This means that all of the hostages will be released very soon, and Israel will withdraw its troops to an agreed-upon line as the first steps toward a strong, durable, and everlasting peace.”
Israeli Prime Minister Benjamin Netanyahu welcomed the announcement, saying, “With God’s help, we’re bringing everyone home.”
According to Trump, all remaining hostages are expected to be released by Monday, and he may travel to Israel on Sunday to address the Knesset.
The Israel Defense Forces confirmed preparations are underway to implement the ceasefire’s first phase.
Market analysts said the rally reflected both relief and renewed confidence in Israel’s economy after months of conflict.
“The shekel exchange rate is a barometer for the level of risk in the capital market,” said Ori Tuval, CEO of Tuval Investment House and chairman of Allamanda Capital. “If we see a comprehensive deal that leads to an agreement in the Middle East with Saudi Arabia and other Arab countries, the dollar exchange rate could fall toward three shekels or even lower.”
Tuval added that a stronger shekel could ease inflationary pressures, allowing the Bank of Israel to cut interest rates sooner than expected.
The ceasefire announcement comes amid diplomatic efforts to stabilize the region and could mark the beginning of a wider normalization process between Israel and several Arab states.
