Weekly Macro Highlights and outlook

ISRAEL - In Brief 01 Aug 2016 by Jonathan Katz
Full employment likely to support wage pressure The labor market in Israel is rapidly tightening, supporting wage pressure.Unemployment declined to 4.8% in Q216.For the 25-64 age group unemployment declined to 4.0% in Q216 from 4.5% in Q1.In June, unemployment declined further to 3.9%.Job growth has been strong, up 4% SAAR.Labor participation has also moved higher in Q2.The % of full time workers is up as well, a sign of a tightening market.A tightening labor market supports further wage pressure.This should impact inflation as well, especially services (rental prices especially).In the short-term a strong shekel and lower energy prices will dampen prices.Petrol prices declined 4.5% today contributing -0.15% to CPI.The MOF announced that vehicle insurance will not decline this year as previously expected.Q216 witnessed steady PC demand with chain store sales up 3.9% SAAR.The BOI is considering moving to 8 rate decisions a year (from 12).This is most likely due to the recent stability of rates, expected to continue. We do not expect a rate hike before 2018.The MOF reduced the monthly bond issuance to 3.0bn ILS in August from 3.5.This is due to the lower-than-expected deficit this year, expected to reach 2.5% GDP (below 2.9% target).With huge redemptions of 13.4bn in August the bond market will enjoy strong excess demand.

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.