The Bank of Israel’s July 6 decision follows its May 25 cut of 25 basis points to 3.75 percent, which resumed an easing cycle after pauses in February and March. Contained inflation near the midpoint of the 1–3 percent target band, a notably stronger shekel, and signs of economic recovery after the Q1 contraction have supported trader expectations for further modest easing in monetary policy. Geopolitical uncertainty tied to regional conflicts continues to warrant caution from the Monetary Committee, limiting the projected pace of additional rate reductions and keeping a hold as a plausible alternative outcome. Current pricing reflects this balance of domestic stability indicators against external risks, with little momentum behind any policy tightening.