YUSUFALI: Children of Israel! call to mind the (special) favour which I bestowed upon you, and that I preferred you to all other (for My Message).
PICKTHAL: O Children of Israel! Remember My favour wherewith I favoured you and how I preferred you to (all) creatures.
SHAKIR: O children of Israel! call to mind My favor which I bestowed on you and that I made you excel the nations.
This verse talk about the unique status of Israel.Reading the verse it sound like Muhammad agree with the Biblical verses about the chosen nation:
For thou art a holy people unto the LORD thy God: the LORD thy God hath chosen thee to be His own treasure, out of all peoples that are upon the face of the earth.
The LORD did not set His love upon you, nor choose you, because ye were more in number than any people--for ye were the fewest of all peoples-- but because the LORD loved you, and because He would keep the oath which He swore unto your fathers, hath the LORD brought you out with a mighty hand, and redeemed you out of the house of bondage, from the hand of Pharaoh king of Egypt. (Deuteronomy 7:6-8)
If we compare the translations we see that YUSUFALI added interpretation-I preferred you to all other (for My Message). So it would sound that Israel aren't special nation,just God decided to start with them...