Israel Economic Outlook
June 7, 2022Following three quarters of rapid expansion, economic activity shrank in quarter-on-quarter terms during Q1, with private consumption, public spending, fixed investment and exports all weakening. Nonetheless, the economy’s underlying strengths remained intact: The labor market tightened notably, while Covid-19 restrictions were eased. The economy should return to growth in Q2: In April, the unemployment rate tumbled below its pre-pandemic level, while the Composite State of the Economy Index rose at its fastest pace in six months. Moreover, visitor arrivals were up 28% from the prior month in April, and the scrapping of all remaining travel restrictions from mid-May will be boosting tourism towards the end of the quarter. Finally, the global energy crisis is benefiting Israel’s gas sector: The government recently renewed gas exploration and hopes to soon reach a deal to supply gas to Europe.
Israel Economic GrowthGrowth should be rapid this year, sustained by recovering tourism, a booming tech sector, stronger gas output and improving relations with Gulf neighbors. The most recent example of strengthening ties came in late May, with the formal signing of a trade deal with the UAE covering 95% of tradable products. However, higher inflation and unrest in Palestine are risks. FocusEconomics analysts see the economy expanding 4.9% in 2022, which is down 0.2 percentage points from last month’s forecast, before growing 3.5% in 2023.
Israel Economy Data
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|Bond Yield||0.98||-1.69 %||Jan 01|
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Israel Economic News
July 21, 2022
The Bank Hapoalim/IPLMA Manufacturing Purchasing Managers’ Index (PMI) came in at 53.4 in June, up from May's 52.6.
July 15, 2022
Consumer prices increased 0.38% in June over the previous month, which was below the 0.57% rise logged in May.
July 13, 2022
Merchandise exports soared 22.0% on an annual basis in June (May: +12.5% year-on-year).
July 1, 2022
What happened: At the end of June, Parliament was dissolved and snap elections were set for 1 November.
June 27, 2022
The Bank of Israel’s Composite State of the Economy Index expanded 0.05% in month-on-month seasonally-adjusted terms in June, which contrasted May's 0.10% decrease.