Netanyahu "wins" the elections, but coalition formation will be difficult

ISRAEL - In Brief 03 Mar 2020 by Jonathan Katz

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Politics: According to surveys of the three main TV stations (conducted at the voting areas), the right-wing block received 59 seats to 55 for the left/center/Arab parties. Lieberman received 6 seats. The Likud party received 37 seats to 33 for Blue and White. After 62% of all votes have been counted, the right-wing block has 58 seats. The election results are clearly a victory for Netanyahu and the right-wing block (who had 55 seats in September's elections). Nevertheless, coalition formation still remains a difficult task (assuming these results), and will require some "deserters" from the center parties, or Lieberman caving in and joining Netanyahu, which he has vowed not to do. Lieberman is not willing to join a coalition dependent on the Arab parties as well. We await the final vote count this evening or by tomorrow. If the right-wing parties do not reach 61 seats, the political paralysis could continue, although no one wants a fourth round of elections. In any event, without 61 seats for the right, Netanyahu's trial will commence on March 17th as he will not be able to legislate some form of immunity. We will update as final election returns come in. Recent economic data points to fairly robust growth through January: PC indicators reflect fairly steady household demand. Credit card purchases are up 9.1% saar in November-January. Chain store sales are up 2.6% saar in November-January. Service exports (excluding start-up sales) are up 19% saar in Q419. Labor statistics remain strong with strong employment growth in January (0.7% m/m, 1.9% y/y) and low unemployment of 3% (ages 25-64). Last week the shekel weakened by 1.3% against the dollar, and by 3.2% against the...