The growth in employment will be crucial for recovery
Highlights:
Although official unemployment rose only slightly in March to 3.4%, this does not represent the actual state of the labor market.
* Those on forced non-pay vacation are not considered unemployed.
* If this segment is included, it is estimated that 817k were out of work in March, or 20% of the labor force.
* In April, this figure rose to 1.1ml or 27% (Source: Employment Agency).
* It will be crucial to see how quickly this figure declines as the economy opens up, a process that commenced two weeks ago.
* The number of job vacancies declined sharply in March, by 36%.
Israeli savings institutions were net FX purchasers in Q120 of 12.1bn USD.
* Institutions were forced to liquidate their FX hedging as foreign equity valuations declined sharply.
The shekel appreciated last week by 0.9% against the USD but weakened by 1.3% against the EUR.
Petrol prices declined by 2% in May; our May CPI forecast stands at 0.1%.
The MoF issued abroad (Asia) 5bn USD, for 40 years at 3.8% interest.
* In May, tradeable domestic bond issuance will reach 10.5bn NIS, double the pace of the previous months.
* The sharp increase is also due to huge redemptions in May.
* We think that bond issuance will stabilize at 9bn per month in 2H20.
* Steady BoI bond purchases should prevent higher bond yields.
Now read on...
Register to sample a report