The move appeared to quickly calm the market as the currency recovered from steep early losses.
The Bank of Israel will use SWAP mechanisms to inject liquidity into the market, with a maximum of US$15 billion allocated.
The central bank also said it would provide liquidity through SWAP mechanisms in the market of up to US$15 billion. Ahead of the announcement, the shekel had weakened by more than 2% to a more than 7-1/2 year low of 3.92 per dollar. The shekel now stands at a rate of 3.86, down 0.6%.
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