Mishtanim (Variable-Rate Government Bonds)
Floating-rate Israeli government bonds — the state's variable-cost borrowing and an investor rate hedge.
Definition. Mishtanim are floating-rate Israeli government bonds whose coupon resets against a short-term benchmark, letting the state borrow at variable cost and giving investors a hedge against rising rates.
Issued by the Israeli government through the Bank of Israel and the Ministry of Finance, mishtanim (“variables”) sit alongside fixed-rate shekel bonds (shikli) and CPI-linked bonds (galil) in the sovereign toolkit. They matter most in a rising-rate environment, when fixed-rate holders lose and floating-rate holders are protected. For institutional allocators managing duration across the Tel Bond Index and government curve, the mix of mishtanim versus fixed paper is an active policy and portfolio decision — and a window into how the Treasury reads its own rate risk.
