top of page

State of the Economy: December 2019 Update

Updated: Dec 16, 2019

The market was in for a surprise when the Bank of Israel’s Monetary Committee decided not to lower interest rates at its last meeting. The decision came as a shock to many analysts who had expected a rate cut from 0.25% down to 0.10%. Professor Amir Yaron, Governor of the Bank of Israel, put away his scissors, and took out his change purse - opting to tackle the strengthening shekel with a USD shopping spree. 

Currently, the economy is relatively stable. Despite the latest OECD forecasting a 2.9% 2-year growth rate as opposed to an earlier 3.3% prediction, the number is significantly higher than the average of all OECD countries. Unemployment is at a record-breaking low, and Israelis are making more than ever as household income grew faster than expenditure. 

Despite the positive state of affairs, Yaron was likely concerned about the future. A government has yet to form, and the country is operating on a continuation budget. This instability may lead to an economic slowdown, which makes it more likely that the Bank of Israel will cut interest rates down the road.


Recent Posts

See All
bottom of page