ISRAEL
Analyst
Jonathan Katz
Former Chief Economist, Finance Ministry Budget DepartmentRecent Country Insights
The BoI expresses approval of the 2025 fiscal framework
ISRAEL · In Brief · 25 Nov 2024
There were no surprises in the rate decision (hold) or monetary announcement. “Monetary Committee’s policy is focused on stabilizing the markets and reducing uncertainty”, the same sentence for over one year. Inflation (3.5%) remains above target and is expected to accelerate y/y in early 2025 (d...
Signs of a weakening labor market
ISRAEL · Report · 25 Nov 2024
1. A close analysis points to a softening of the labor market. 2. We expect a rate-hold decision today, with a positive mention regarding the 2025 fiscal framework. 3. Foreigners have been net purchasers of Israeli government bonds in recent months.
Israel's risk premium declines on ceasefire expectations
ISRAEL · In Brief · 24 Nov 2024
Geopolitics: A ceasefire in North still appears likely in the coming week, according to both Lebanese and Israel sources. The ground operation on both fronts is winding down, although missiles and drones continue to land in the extended North of Israel resulting in some damage and casualties, as ...
Inflation remains elevated but likely to moderate in 2025
ISRAEL · Report · 18 Nov 2024
1. Core inflation pushed higher in October due to higher airfares, a volatile item. 2. We view the fiscal package for 2025 as restrictive and likely to dampen household demand. 3. We expect inflation to moderate in 2025, supportive of monetary easing.
Inflation pressures likely to subside in 2025, supporting rate cuts
ISRAEL · In Brief · 17 Nov 2024
Geopolitics: A ceasefire in North still appears likely, but may have to wait for Trump. The ground operation on both fronts is winding down, although missiles and drones continue to land in the extended North of Israel resulting in some damage and casualties. The imminent threat from a ballistic ...
Inflation in October as expected, core accelerates
ISRAEL · In Brief · 15 Nov 2024
Inflation in October as expected, core accelerates In October, the CPI rose by 0.5% m/m (according to consensus, we were leaning towards 0.6%), and remained stable at 3.5% y/y. Core inflation (The CPI excluding energy and fresh produce) accelerated to 3.3% y/y from 3.0% last month, mostly due to ...
Strong export growth is shekel supportive
ISRAEL · In Brief · 13 Nov 2024
Exports surged in recent months. In August-October, industrial exports increased by 15% q/q, with strong growth in sectors identified as mostly defense: Metal products/machinery and transport equipment, but in pharma and chemical products as well. But generally, high-tech exports were up 14%. Imp...
The shekel appreciates on US election results
ISRAEL · Report · 08 Nov 2024
Ceasefires (in Gaza as well as Lebanon) do not appear to be on the immediate horizon. The ground operation on both fronts is winding down, although missiles and drones continue to land in the extended North of Israel, resulting in some damage and casualties. The immediate risk is from Iran, which...
Markets will follow the fiscal approval process closely
ISRAEL · Report · 04 Nov 2024
1. The 4% deficit target has been approved by the cabinet, but the full implementation of adjustments appears unlikely. 2. Optimism regarding a decline in hostilities and a possible ceasefire has supported the long end of the curve, but much will depend on fiscal credibility. 3. Recent econ...