A stronger shekel supports lower inflation and will postpone tightening

ISRAEL - Report 28 May 2018 by Jonathan Katz

The shekel has appreciated by 2.7% so far this month, which is supportive of lower inflation and rate hike postponement. The labor market remains tight with job vacancies up and job seekers down. Consumption of services remains robust while consumption of goods (domestically) has softened.

Politics: Violence on the Gaza border has subsided. The big news politically is the expected indictment of PM Netanyahu in the coming days over his accepting more than NIS 1bn of presents (champagne and cigars) from wealthy benefactors over the past three years. Other issues are also being investigated, such as Netanyahu's favorable treatment towards Bezeq (controlled by Elovitch) in exchange for favorable coverage in the Walla news service. An indictment could trigger early elections.

Important data this week: On Wednesday, debit card purchases for April will be released (an important PC indicator), and on Thursday employment data for April will come out. It will be interesting to see whether the record low unemployment level of March (3.6%) will be maintained. Today is a rate decision, but we do not expect any surprises; rate stability is expected, with no change in the forward guidance.

Now read on...

Register to sample a report

Register
Sign-in
Forgot your password?
Copyright 2024 GlobalSource Partners. All rights reserved. This report is prepared for GlobalSource Partners’ clients and may not be redistributed, reproduced, stored in a retrieval system, retransmitted or disclosed, in whole or in part, or in any form or manner, without the express written consent of GlobalSource Partners. This report is distributed simultaneously to our website and other portals used by GlobalSource Partners. The information herein was obtained from various sources and is believed to be reliable but GlobalSource Partners does not warrant its completeness or accuracy. Neither GlobalSource Partners nor any Country Analyst, officer or employee accepts any liability whatsoever for any direct, indirect or consequential damages or losses rising from any use of this report or its contents.