Markets will be following fiscal policy closely

ISRAEL - Report 09 Jan 2023 by Jonathan Katz

1. S&P has expressed concern regarding the political, geopolitical and fiscal policy of the new government.

2. Business sentiment remains strong, with some softening of future expectations.

3. Rapid wage growth in the business sector reflects a tight labor market; public sector wage increases are expected this year.

4. Policy rates are likely to reach 4.25% in Q223, above the BoI forecast of 4.0%.

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