The long end of the curve appears well anchored on BoI purchases

ISRAEL - In Brief 25 May 2020 by Jonathan Katz
Highlights of the weekly macro Wrap Up 26.5.20 The economy continues to return gradually to full activity Credit card purchases increased by 80% from April 19th to May 18th. Purchases in mid-May are still down 12% YTD. Output of electricity in the first two weeks of May is down 9.9% y/y compare to -12.8% in April. April's data remains dismal - The number of unemployed and "temporary absent from work" due to Covid-19 reached 1.4ml up from 1.03ml in March. The official unemployment rates remains low at 3.3%, but counting the additional "temporarily absent" (forced non-pay leave), unemployment reached 34.7% in April up from 21% in March. We expect unemployment will reach 8%-9% by end-year. Q120 GDP data reflect a contraction of -7.1% saar - PC down 20.3%, exports down 5.9% and investments down 17.3%. Imports declined by a sharp 27.5% (supporting GDP). On the upside, industrial exports increased by 13.9% and "other services" (mostly high tech) exports increased by 18.4%! Job vacancies in April declined to 27k, down from 90k in February. The PMI improved modestly in April to 39.3 points, still reflecting contraction. Inflation: We currently expect inflation to move slightly higher on the back of higher petrol prices in June, as well as higher fresh produce prices due to an extreme heat wave last week. We expect June's CPI to reach zero (previously -0.1%), and July to reach 0.2% m/m (previously 0.1%). Monetary policy: Policy rates remained stable on Monday at a level of 0.1%. The forward guidance regarding the possibility of more accommodation and the use of other monetary tools was maintained. The Bank of Israel updated their GDP forecast.With the economy opening up more ra...

Now read on...

Register to sample a report

Register
Sign-in
Forgot your password?
Copyright 2024 GlobalSource Partners. All rights reserved. This 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 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 or its contents.