Interest Rate in Israel

Israel Interest Rate | Economic News & Forecasts

Israel - Interest Rate

Bank of Israel leaves rates unchanged in October, but turns more hawkish

At its 14 October meeting, the Bank of Israel (BoI) left the policy rate at 0.10%.

The decision to keep rates stable at their current low level was likely driven by continued uncertainty over the economic outlook, due to the possibility of further waves of Covid-19. Moreover, although inflation has risen substantially in recent months, it remains within the 1.0%–3.0% target range—as do inflation expectations. As such, the Bank had the space to maintain an accommodative stance.

In its communiqué, the BoI took a more hawkish stance, pledging to adopt an “accommodative monetary policy” rather than the prior meeting’s promise of a “very accommodative monetary policy”. Moreover, the Bank mentioned that its various quantitative easing programs could be ended in the next few months if growth remains healthy. That said, most panelists still see the policy rate remaining at 0.10% until 2023, as current price pressures are partly transitory. Moreover, following many years of extremely weak inflation, the Bank will likely be looking to ensure market inflation expectations become solidified within the target range.

Our panelists see the policy rate ending 2021 at 0.10% and 2022 at 0.12%.

Israel - Interest Rate Data

2015   2016   2017   2018   2019  
Policy Interest Rate (%)0.10  0.10  0.10  0.25  0.25  

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Israel Interest Rate Chart


Israel Interest Rate
Note: BoI Interest rate in %.
Source: Central Bank of Israel.

Israel Facts

Value Change Date
Bond Yield0.98-1.69 %Jan 01
Exchange Rate3.46-0.37 %Dec 31

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