The Bank of Israel left its benchmark interest rate unchanged at 4.5% on Monday, marking the 12th consecutive hold as policymakers gauge whether a recent rally in the shekel will be enough to push inflation back inside the central bank’s 1%-to-3% target range. The currency has gained about 6% against the dollar since a U.S.-brokered cease-fire last month ended a brief war with Iran, sending the shekel to its strongest level in three years and narrowing five-year credit-default-swap spreads to near-prewar lows. Annual consumer-price growth eased to 3.1% in May but remains above target, while labor shortages tied to extended military reserve duty risk rekindling price pressures. Governor Amir Yaron reiterated that further moves will be “data-dependent,” balancing the disinflationary effect of a stronger currency against domestic cost pressures. Economists at Citi, Leader Capital Markets and Bank Hapoalim say the conditions for an easing cycle are falling into place and assign growing odds to a first 25-basis-point cut at the next policy meeting on 20 August if the shekel’s gains persist and inflation continues to slow.