ISRAEL - In Brief 18 Jan 2022

The PMI declined by 2.5 points in December to 47.8, reflecting a contraction in activity for the first time in four months.The main component which declined sharply was the production output component, and this could be due to spiking Covid infections keeping some workers at home. The domestic or...

ISRAEL - Report 18 Jan 2022

1. December’s CPI surprised on the upside as core inflation accelerated to 2.7% y/y. 2. We expect inflation to reach 1.7% this year on the back of wage pressure and higher rental prices, partially offset by shekel appreciation. 3. We expect the BoI to hike on April 11 due to high inflat...

ISRAEL - In Brief 16 Jan 2022

Inflation surprises on the upsideo Inflation in December increased by 0.3% m/m (expectations were for 0.1%), and 2.8% y/y. Core inflation increased by 2.7%.o Inflation surprises were mostly broad-based, with housing rental prices accelerating to 3.3% y/y (from 2.9% last month).o We expect inflati...

ISRAEL - In Brief 14 Jan 2022 1 response

December’s CPI surprises on the upside Following two months of downward inflation surprises, inflation in December reached 0.3% m/m (expectations were for 0.1%) and 2.8% y/y (up from 2.4% last month).Food prices surprised on the upside, increasing by 0.5% m/m and 3.5% y/y. Rental prices (OER) inc...

ISRAEL - In Brief 13 Jan 2022

Export growth remains strong in Q4 Manufacturing exports expanded by 13% saar in Q4 following growth of 25% in Q3. Export growth was concentrated in computer components, pharmaceuticals and defense industries. Manufacturing exports increased by 15% in all of 2021. In Q4, imports of raw materials ...

ISRAEL - In Brief 11 Jan 2022

Israeli savings institutions (with over 0.5 trillion USD under management) have been gradually selling FX all year as higher equity valuations abroad have forced them to sell FX (by derivatives) in order to avoid increasing their FX exposure. Institutions were net FX sellers of 21bn USD through O...

ISRAEL - In Brief 11 Jan 2022

The fiscal deficit in 2021 reached 4.5% GDP, close to half the initial estimates at the beginning of the year (expectations of over 8%). Total fiscal revenues increased by 30% y/y (and by 19% compared to 2019) on the back of capital gains taxation of the hi-tech sector, strong real estate activit...

ISRAEL - Report 10 Jan 2022

1. Both business and consumer sentiment remained fairly strong in December, despite Omicron, but January will probably witness some decline. 2. Wage growth moderated in October, supportive of modest inflationary pressure. 3. The expansion of the monetary base slowed in 2021, following ...

ISRAEL - In Brief 09 Jan 2022

Business and consumer confidence remains strong in DecemberThe Business Tendency Survey for December reflects expectations of further expansion in all sectors, except for the hotel sector (due to incoming flight restrictions).The Poalim consumer confidence index improved slightly in December and ...

ISRAEL - Report 03 Jan 2022

1. The BoI sees inflation under control and stresses the luxury of being patient with monetary tightening, despite strong activity and employment growth. 2. Hi-tech services exports continue to surge, supportive of shekel appreciation. 3. Private consumption growth has shifted more to...

ISRAEL - In Brief 03 Jan 2022

The policy rate statement today had a slightly more hawkish tone as data released since the previous rate decision has been rather robust, with strong employment growth in November (92k new employees) and accelerating activity. and private consumption. On the other hand, the possible downside ris...

ISRAEL - In Brief 28 Dec 2021

Hi-tech service exports have increased sharply in October (3.5% m/m) following growth of 5.3% in September. Since the beginning of the year, hi-tech service exports (computer, IT, cyber, etc.) are up 22% y/y. This vibrant sector (10% of GDP), has supported shekel appreciation, economic growth and...

ISRAEL - Report 27 Dec 2021

1. An increasingly tight labor market is expected to support wage pressure and therefore some inflationary pressure as well. 2. Economic indicators point to steady growth in early Q421, before the December Omicron concerns. 3. MSCI is likely to reclassify Israel in MSCI Europe (from...

ISRAEL - In Brief 26 Dec 2021

Economic data released last week point to an increasingly tightening labor market, as the number of employed increased reducing unemployment, while the number of job vacancies continued to rise. The number of employed increased by 92 thousand in November, reducing broad unemployment (including th...

ISRAEL - Report 20 Dec 2021

Highlights​: Low inflation in November: *Headline inflation in November inched higher to 2.4% y/y from 2.3%, in line with our forecast but at the low end of consensus. *Core inflation has remained stable at 2.1% since September. *Housing rental prices accelerated in November, offset by a ...