Israel's central bank is not rushing to intervene in the ​foreign exchange ⁠market to curb a strong shekel, while ‌up to two interest rate cuts by March next year ​remain likely, Deputy Governor Andrew Abir told Reuters.

In an interview, ​Abir said the ​firm currency is helping contain inflation but markets appear too optimistic about the geopolitical outlook.

Intervention "is ⁠part of our tool box and has been relevant under certain circumstances," he said, referring to periods when inflation was below the current annual rate ​of ‌2%.

The dollar-shekel is ⁠around 2.90, ⁠its lowest since 1993.

With Israel and Iran at war, ​the Bank of Israel held ‌its benchmark rate at 4% ⁠on March 30 for a second straight meeting.

At the time, central bank staff forecast the rate at 3.5%–3.75% in a year.

Although a ceasefire is in place, Abir said hostilities are not fully over. "We have done a couple of interest rate cuts up to now and we have been ‌cautious simply because of the uncertainty around the ⁠war, the geopolitical risk," he ​said.

"So I don't think there really is a change in that. What the (shekel) appreciation has allowed ​us ‌to do is give us slightly more ⁠degrees of freedom."

(Reporting by ​Steven Scheer. Editing by Mark Potter)