The term “shekel” refers to a unit of currency, carrying a long and varied history across different eras and regions. This name has been associated with economic value for millennia, evolving from an ancient measure of weight to a modern national currency. Understanding the shekel involves recognizing its journey through time and its present-day significance. The concept of a shekel provides a lens through which to explore both historical commerce and contemporary financial systems.
The Modern Israeli Shekel
Today, the shekel is known as the official currency of Israel, specifically designated as the Israeli New Shekel (NIS), or simply shekel. It also functions as a de facto legal tender within the Palestinian territories of the West Bank and the Gaza Strip. The international currency code for the New Shekel is ILS, and its symbol is ₪. The Bank of Israel, the country’s central bank, is responsible for issuing and regulating this currency, playing a significant role in maintaining price stability within the Israeli economy.
The Israeli New Shekel operates under a managed floating exchange rate system, where market forces primarily determine its value against other currencies. The Bank of Israel can intervene in the foreign exchange market to manage stability or mitigate excessive fluctuations. The Israeli economy is highly developed and diverse, characterized by a robust high-tech sector, strong foreign reserves, and conservative fiscal policies. As of September 27, 2024, approximately 3.35 Israeli New Shekels equate to one US Dollar, though exchange rates fluctuate daily.
Historical Roots of the Shekel
The concept of the shekel has roots stretching back approximately 5,000 years to ancient Mesopotamia, long before the advent of minted coins. Initially, the shekel served as a unit of weight, primarily used for measuring precious metals like silver, gold, and bronze during trade and commerce. Its name derives from the Proto-Semitic root “ṯql,” which is cognate to Akkadian “šiqlu” or “siqlu,” meaning “to weigh” or “a standard weight.” This early usage is attested in texts from the reign of Naram-Sin of Akkad around 2150 BCE and in the Code of Hammurabi around 1700 BCE.
The shekel frequently appears in ancient biblical texts, highlighting its significance in early economic and religious practices. For example, Abraham’s purchase of the Cave of Machpelah for 400 shekels of silver demonstrates its role in substantial transactions. Ancient shekels were not standardized in weight across all regions, typically ranging from about 7 to 17 grams, though a common weight in ancient Israel was approximately 11 grams. The use of precise weights was important for fair trade, with different types of shekels, such as the “sanctuary shekel,” being mentioned in religious contexts like the collection of a half-shekel tax for the Tabernacle.
Over millennia, the shekel evolved from merely a weighed quantity of metal into a form of currency. Ancient cultures such as the Phoenicians, Carthaginians, and Hasmonean Judeans eventually minted coins referred to as shekels. The continuity of the name “shekel” reflects a deep historical connection, bridging ancient commercial practices with modern monetary systems. In the modern era, after using the Israeli Pound, Israel introduced the Old Israeli Shekel in 1980, which was then replaced by the New Israeli Shekel in 1985 to combat hyperinflation, marking a return to the historic name.
Physical Characteristics and Denominations
The modern Israeli New Shekel currency system includes both banknotes and coins, designed with distinctive features and security elements. Banknotes are issued in denominations of 20, 50, 100, and 200 shekels, each featuring portraits of prominent Hebrew poets from Series C, which began circulation in 2014:
- The 20-shekel note is red and displays Rachel Bluwstein.
- The 50-shekel note is green with Shaul Tchernichovsky.
- The 100-shekel note is orange featuring Leah Goldberg.
- The 200-shekel note is blue with Nathan Alterman.
These banknotes incorporate intricate designs, including micro-printed excerpts of poems by the featured poets, as well as images of relevant natural elements like palm tree branches, citrus fruit, almond blossoms, or moonlit flora. Advanced security features are embedded within each note to prevent counterfeiting, such as transparent portraits visible when held to light, color-shifting ink, security threads, perforated numerals, and raised ink. These elements ensure both the aesthetic appeal and the integrity of the currency.
The shekel is subdivided into 100 agorot, a term that has been used for sub-units of Israeli currency since 1960. Coins currently in circulation include:
- 10 agorot
- ½ shekel
- 1 shekel
- 2 shekels
- 5 shekels
- 10 shekels
Each coin carries unique designs reflecting Israeli heritage; for instance, the 10 agorot coin features a menorah, the ½ shekel coin displays a lyre, and the 1-shekel coin shows a lily. Materials vary among coins, with some being copper-nickel alloys, others steel or nickel-clad, and the 10-shekel coin uniquely featuring a steel frame with a brassy center.