Headline Q2 2019 GDP growth reached 1.0% saar following 4.7% in Q1 2019.
* Growth excluding import taxes reached 3.1%, following 3.2% in Q1 2019. This is more reflective of real activity, due to the higher taxes on new vehicles on April 1.
* Exports (excluding diamonds and start-ups...
The BoI Company Survey for Q2 2019 is pointing to modest growth.
* The net total balance is only +5, below that in 2018 (+12.8).
* Industry and retail trade are reporting contraction in activity, while services, construction and hotels are reporting expansion.
Unemployment remains low and the labor market tight.
* Unemployment in Q2 2019 reached 3.9% from 4.0% in Q1 2019.
* Unemployment in the 25-64 age group reached 3.3% in Q2 2019.
* Job growth slowed in Q2 2019, and labor participation declined.
* The labor market remains t...
The shekel appreciated by 0.8% last week (against the basket).
* We think the shekel has strengthened in part due to the divergence of monetary policies, with the BoI still projecting a tightening bias while most other central banks are reducing rates.
* The shekel ha...
June's CPI (-0.6% m/m, 0.8% y/y) came in way below expectations.
* Both fresh produce and rental prices surprised on the downside.
* Nevertheless, core inflation remained stable at 1.1% y/y.
We expect inflation to reach 1.0% in 2019 and 1.1% NTM.
* This foreca...
Policy rates remained on hold last week.
* The BoI Governor's press conference and the macro forecast reflected a clear tightening bias. Governor Yaron sees the likelihood of a rate hike in "one of the upcoming decisions". He also said that Israel could tighten while other b...
The fiscal deficit (LTM) moved higher in June to 3.9% GDP. The fiscal deficit is increasing and is likely to breach 4% GDP this year. Wage growth has moderated recently, up 3.0% y/y in April from 3.8% in March. Israeli saving institutions reduced their FX exposure in May to 16.5% from 17.2% in Ap...
Economic growth appears to have slowed in 2Q2019.
* The BOI composite index slowed to 0.1% y/y in May.
* Employment growth has stalled in April-May.
* Unemployment remains low (3.2% ages 25-64) on lower labor participation.
* Chain store sales increased by 0.6% saar in March-M...
Residential completions increased sharply (18% q/q) in Q1 2019.
- This is supportive of softer rental prices as inventory increases.
- Housing starts declined in Q1 2019 but an upward revision is likely.
Job vacancies have declined in recent months.
- This is mo...