Inflation is expected to accelerate

ISRAEL - Report 20 May 2024 by Jonathan Katz

1. Despite strong GDP growth in Q124, the level of activity remains significantly below potential.

2. Inflation is expected to accelerate on the back of fiscal expansion, a tight labor market and excess demand in the housing market.

3. As long as geopolitical risks remain elevated, it is difficult to envision monetary loosening, especially with inflation expected to accelerate.

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